Gold Rallies to Three-Month High as US Fiscal Concerns Mount
Gold prices have reached a three-month high after rising over five percent last week due to concerns about US fiscal sustainability, Treasury market intervention, and a weaker dollar. Despite this rally, old gold sales at retail counters in India showed no significant improvement in August. According to Surendra Mehta, Secretary of the Indian Bullion and Jewellers Association (IBJA), sales were only marginally better than the previous month.
Festive buying remained subdued despite Raksha Bandhan, a Hindu holiday celebrated with the purchase of gold jewelry. The trend suggests that households have not yet significantly increased the sale of old gold despite elevated prices. Mehta noted that physical gold demand could be affected if prices continue to rise.
Gold traded around $4,633 per ounce in the PM fixing on August 24, after rising to its highest level in more than three months. Prices had previously traded above $4,700 in May 2026. Analysts remain moderately bullish on the outlook for gold, with Nirpendra Yadav of Bonanza stating that gold needs to sustain above $4,700, $4,750 to continue its rally.