Gold settled higher by 0.74% at Rs 144,138, buoyed by declining prices that alleviated inflation concerns in anticipation of the US Federal Reserve’s policy meeting. However, gains were constrained by elevated Treasury yields, as market participants continued to express concerns that interest rates may persist at elevated levels for an extended period. Traders are assigning an 82% probability to a US rate hike in December, as indicated by the CME FedWatch Tool. Analysts have revised their 2026 gold price forecast downward to $4,495 per troy ounce, a decrease from the previous estimate of $4,509.
This adjustment is attributed to robust Treasury yields, the strength of the dollar, and expectations of tighter monetary policy. However, they continue to uphold a recovery outlook for 2027. Goldman Sachs maintained its end-2027 forecast at $5,400 per ounce, emphasising that ongoing central bank diversification remains a significant long-term catalyst. China’s central bank has continued its gold purchasing trend for 23 consecutive months as of September, raising its holdings to 77.47 million fine troy ounces from 76.73 million ounces in August. However, the value of its reserves has decreased to $323.52 billion.
In September, Swiss gold exports experienced a month-on-month increase of 6%, reaching 165.2 tonnes, marking the highest level since February 2025. This uptick was primarily attributed to heightened shipments to Britain, whereas exports to China and India saw a decline. Physical gold demand in India saw an uptick as reduced prices during the Dussehra festival stimulated purchases, leading to an increase in domestic premiums to $9 per ounce. In contrast, Chinese jewellery demand continued to be lacklustre.
Technically, the market is experiencing short covering, as evidenced by a 2.34% decline in open interest to 15,622 contracts, accompanied by a price increase of Rs 1,065. Gold exhibits support levels at Rs 142,740 and Rs 141,340, with resistance identified at Rs 144,900. A sustained move above Rs 144,900 could push prices toward Rs 145,670, whereas a break below Rs 142,740 may trigger further downside toward Rs 141,340.
