Fed Rate Decision May Ease Gold Price Uncertainty
Gold and silver prices may find support if the US Federal Reserve decides not to raise interest rates, according to Surendra Mehta, Secretary at the India Bullion & Jewellers Association (IBJA).
Mehta expects jewellery sales to improve after a relatively slower September due to uncertainty surrounding gold import duty and expectations of a Fed rate hike.
The recent moderation in demand was attributed to concerns that a rate increase could add to the debt burden in the US and create pressure across global financial markets, Mehta said. He believes a rate hike is less likely this time around, as Kevin Warsh may go with Donald Trump's views.
The uncertainty surrounding gold import duty is unlikely to change before the next Union Budget, which could provide clarity for buyers and boost demand. Mehta also defended the recent increase in hallmarking charges from ₹45 to ₹75 per article, citing rising operating costs for hallmarking centres.