Gold settled 1.89% higher at Rs.162,438, buoyed by a weaker dollar as investors scrutinised the potential impact of the US Treasury’s expanded bond-buyback program on market confidence. Treasury Secretary Scott Bessent indicated that the government may further increase Treasury repurchases after announcing plans to double longer-dated debt buybacks to contain bond yields. Two Federal Reserve officials also voiced reservations regarding the possible consequences of alterations in Treasury debt management on monetary policy. Markets are currently assigning a 67% likelihood to the Federal Reserve maintaining its interest rates in September.
Meanwhile, Morgan Stanley anticipates that gold prices may surpass $5,000 per ounce by 2027, possibly even sooner, although fluctuations in US inflation data could contribute to ongoing market volatility. Physical demand in India has remained subdued, with dealers providing discounts of up to $65 per ounce, as elevated prices have deterred retail purchasing. India’s net gold imports decreased by 23% year-on-year to 98.1 tonnes in the second quarter of 2026, whereas total demand saw a decline of 6% to 131.4 tonnes.
The World Gold Council also highlighted rising unofficial gold inflows following India’s increase in import tariffs to 15%, which has widened grey-market margins. In the second quarter, global gold demand held firm at 1,268.9 tonnes, bolstered by a notable rebound in central bank acquisitions totalling 289 tonnes, even in the face of 45 tonnes in ETF outflows. Russia’s gold reserves experienced a minor reduction, now standing at 73.2 million ounces, whereas holdings in London vaults saw a month-over-month increase of 0.77%, reaching 9,464 tonnes.
Technically, gold continues to attract new buying interest, evidenced by a 3.9% increase in open interest to 11,006, alongside a price gain of Rs.3,013. The market is encountering support at Rs.160,470, with a breach below this level likely paving the way toward Rs.158,495. On the upside, resistance is positioned at Rs.163,550, and a sustained move above this level could catalyse additional gains toward Rs.164,655. Overall, the near-term bias remains optimistic as prices sustain their position above critical support levels.
