Gold prices concluded the trading session with a 0.25% increase, reaching Rs 148,858. This uptick was bolstered by diminishing worries regarding inflation and the prevailing sentiment that the U.S. Federal Reserve might not pursue a tightening of monetary policy as vigorously as earlier anticipated. Optimism surrounding negotiations involving Iran and Oman over the Strait of Hormuz has led to a reduction in geopolitical risk premiums. Concurrently, expectations for a September U.S. rate hike have eased to 55% from 67% just two days prior. Federal Reserve Bank of San Francisco President Mary Daly reaffirmed her support for keeping interest rates steady while policymakers evaluate the latest inflation data.
Investors are now closely monitoring the forthcoming U.S. nonfarm payrolls report, following the recent ADP employment data that suggested a deceleration in private-sector job growth. Fundamental developments exhibited a mixed performance across essential physical markets. China’s gold production in the first half of 2026 experienced a decline of 9.01% year-on-year, totalling 229.99 tonnes, which indicates a decrease in domestic mine output. In contrast, total gold consumption saw a modest increase of 1.23%, reaching 511.41 tonnes. Investment demand exhibited remarkable strength, as gold bar and coin consumption experienced a substantial increase of 28.42%, effectively counterbalancing a significant downturn in jewellery demand.
Physical premiums in China have strengthened to 5-8 per ounce, reflecting an uptick in buying interest. Meanwhile, discounts in India have narrowed as buyers remain cautious, seeking clearer price direction. London vault holdings rose by 0.77% month-on-month, reaching a total of 9,464 tonnes. Meanwhile, the World Gold Council reported that global second-quarter gold demand remained stable at 1,268.9 tonnes, as robust central bank purchases of 289 tonnes compensated for ETF outflows. India’s gold demand for the June quarter experienced a decline of 6% compared to the previous year, as elevated import tariffs persisted in fostering unofficial gold inflows.
Gold continues to find support following renewed buying interest, as evidenced by a 1.48% increase in open interest, which suggests a strengthening of market participation. Immediate support is positioned at Rs 148,010, with subsequent support at Rs 147,165, while resistance is identified at Rs 149,890. A sustained move above this level could extend the rally toward the Rs 150,925 mark, maintaining a constructive near-term bias.