Gold Prices Break Out with 5% Weekly Gain

The gold market experienced a significant breakout during the week of August 17-22. International spot gold prices surged, reaching their highest level in more than three months. The metal gained around 5% for the week, with prices increasing from approximately $4,400-$4,430 per ounce to over $4,624 per ounce.

R Ponmudi, CEO of Enrich Money, noted that 'commodity markets ended the week broadly higher, led by strong gains in precious metals and crude oil.'

The rally was driven by a combination of factors, including lower US Treasury yields, a weaker US dollar, and changing interest-rate expectations. The decline in Treasury yields reduced the opportunity cost of holding gold, making it more attractive to investors.

India's domestic gold prices also surged, with 24-carat rates reaching over Rs 1.62 lakh per 10 grams by the end of the week. The Indian market followed the international rally but displayed an even stronger increase when measured in rupee terms due to a weakening rupee.