Gold has experienced a remarkable increase of nearly 70% this year, with its momentum gaining traction following the global tariff implementation by U.S. President Donald Trump. This surge has been supported by ongoing geopolitical uncertainties, a series of U.S. interest rate reductions, robust purchases by central banks, and consistent inflows into gold-backed exchange-traded funds.
The minutes from the Federal Reserve meeting reveal that a majority of policymakers are still leaning towards additional easing should inflation show signs of continued decline, though there are ongoing disagreements about the appropriate timing and magnitude of forthcoming rate reductions.
The persistent uncertainty surrounding the Russia–Ukraine conflict, escalating tensions in the Middle East, and ongoing frictions between the U.S. and Venezuela have sustained demand for safe-haven assets. The dynamics of the physical market exhibited a mixed performance. In November, China’s net gold imports through Hong Kong surged by 101.5% month-on-month, reaching 16.16 tonnes, indicative of heightened purchasing interest.
Conversely, Indian gold discounts expanded to $61 per ounce, marking the highest level in more than six months, as high prices suppressed retail demand. Chinese discounts contracted significantly, whereas other Asian centers exhibited slight premiums or minor discounts. From a technical perspective, the market is experiencing long liquidation, evidenced by a 2.67% decrease in open interest to 15,721, coupled with a price decline of Rs 1,219. Gold exhibits immediate support at Rs 1,34,735; a breach of this level may lead to a test of Rs 1,34,030. Resistance is identified at Rs 1,36,250, and a breach above this level could pave the way toward Rs 1,37,060.