Chennai: Having moved up 14 per cent in 2023, gold prices are expected to further scale towards Rs 74,000 per 10 gm in 2024.
Gold prices in the domestic market climbed more than 14 per cent in 2023. In 2023, gold in the international market touched $2148 per ounce and Kedia Commodities expects prices to reach $2400 in 2024. In the Indian market, gold prices could move up to Rs 74,000 per 10 gm.
“We remain bullish on gold and expect the prices to hit new highs of around $2,240 if the volatility continues. We also anticipate the prices can reach $2,400 next year if the fundamentals remain strong," said Ajay Kedia, Director, Kedia Advisory.
Among the reasons that would support the gold prices, the dollar index was down 2 per cent in 2023, which was the first yearly decline since 2020. Geo-political tensions in the Middle East are expected to drive gold demand. Globally, gold demand by investors went up 56 per cent in the third quarter. Central bank buying also supported gold prices. In India, the redemption of gold bonds will improve investor interest.
According to Kedia Commodities, central bank gold reserves is expected to go up by 24 per cent in the next 12 months. Further, the rupee may weaken in 2024 as FIIs will take to selling portfolios ahead of the national elections and this will support gold in the Indian market. The US Fed rate dynamics and geo-political tensions are expected to further boost gold prices.
However, on the flip side, the market has already priced the Fed rate cut in March 2024. Further, the US economy is resilient and has strong economic prospects. Global gold demand had slipped 6 per cent in the third quarter.
