Gold Surges on Softer US Inflation Data and Reduced Rate Hike Expectations

Gold prices surged by 1.99% to Rs1,51,820 due to softer U.S. inflation data and reduced expectations of further Federal Reserve rate hikes.

The Central Bank of China increased its gold reserves for the 21st consecutive month, adding the most bullion since October 2023 and lifting holdings to 76.08 million fine troy ounces in July from 75.44 million in June.

UBS expects gold to reach $5,000 per ounce in the first half of 2027, while global demand remained stable with Q2 gold demand at 1,268.9 tonnes.

However, Indian demand remained subdued, with Q2 demand falling 6% year-on-year to 131.4 tonnes and net imports declining 23% to 98.1 tonnes.