Gold Prices Hold Steady in India Amid US Rate Hike Expectations
Indian gold buyers were given a rare respite from price volatility on Monday after the US released its August payrolls report, which showed job creation tripling the consensus forecast. The benchmark 24-karat metal held steady at ₹15,415 per gram, unchanged from Friday's close. This stability in the physical market was reflected in the India Bullion and Jewellers Association morning benchmark, which also came in flat.
The US jobs data pushed Federal Reserve rate hike expectations to around 60 percent, their highest reading in four months. Higher US interest rates typically lift the opportunity cost of holding gold, which yields nothing, and tend to strengthen the dollar against the rupee. This could partly offset any decline in Comex prices in local-currency terms.
Despite the short-term stability in gold prices, analysts pointed to a technical level that has defined the near-term range: if spot Comex gold holds above $5,470 per troy ounce, the low reached on the first post-payrolls session, the fundamentals for a bounce heading into the seasonally strong October period remain plausible.
The long-term structural support beneath Indian gold demand is well-documented. Central banks across Asia and the Middle East have been net buyers of gold for eleven consecutive quarters, according to data tracked by the World Gold Council on its GoldHub platform. This institutional buying creates a demand floor that private market weakness has historically not been able to dislodge for long.