Gold Rallies 16% as Rate Hike Fears, Crude Prices Ease

Gold has staged a sharp comeback after a prolonged period of consolidation, gaining around 16% in August. The rebound is attributed to several factors, including the fading expectations of a US Federal Reserve rate hike and softer crude prices.

Ajay Kedia, MD & Director of Kedia Advisory, notes that easing Middle East concerns have also contributed to the gold price rally. In addition, continued Chinese demand and central-bank buying are supporting gold prices.

The sustained inflows into Exchange-Traded Funds (ETFs) and a weaker dollar index are further boosting gold prices. With India entering its festive season, physical demand is providing another boost to the metal's price.