Recently, Dr. Renisha Chainani, Head of Research at Augmont – Gold for all, noted in her weekly blog that gold prices have hit an all-time high of $3397 (~Rs 96747) on exchanges and nearly Rs 1 lakh in the spot market after accounting for a 3% GST. The increase is being driven by worries about global economic growth due to the intensifying Sino-U.S. trade conflict, with a declining dollar contributing to the upward trend.
At a fundamental level, markets are factoring in heightened geopolitical risks, spurred by U.S. trade conflicts and concerns over stagflation, while ongoing demand from central banks adds pressure to prices. On April 2, U.S. President Donald Trump enacted “reciprocal tariffs” impacting numerous countries; although his administration has delayed some duties, tensions with China have escalated.
China warned other nations on Monday against pursuing a larger economic agreement with the United States that would disadvantage it, which is a strategy Trump reportedly desires from countries looking for tariff reductions or exemptions. Additionally, on Thursday, Trump criticized Federal Reserve Chairman Jerome Powell, hinting that his administration might contemplate dismissing him.
On the geopolitical side, Russia and Ukraine accused each other of multiple violations of President Vladimir Putin’s one-day Easter ceasefire, with the Kremlin asserting that there were no orders to prolong the ceasefire on the front lines.
The next key target for gold may be approximately $3500 (~Rs 100,000) if this upward trend persists; however, the market positioning could seem overcrowded in the short term, and technical signals indicate that the market may be overbought in the near future.
Nonetheless, caution is essential because prices have surged significantly in a brief timeframe. Should prices dip below $3300 (~Rs 94300), profit-taking may drive values down to around $3100 (~Rs 90000). Silver prices have been fluctuating between $32 (~Rs 94000) and $33 (~Rs 97000) and are expected to remain within that range in the upcoming week.