Gold price prediction today: Gold rates are expected to rise in the coming months and investors would do better to buy the yellow metal on dips rather than chasing the rally, says Praveen Singh, Senior Fundamental Research Analyst- Currencies and Commodities at Mirae Asset Sharekhan. The analyst shares his views on gold price outlook and what levels investors should watch out for:Gold Performance:
- At the time of writing this article, spot gold was trading at $3,682, up around 1% for the day. The metal rallied to a fresh record high of $3,685 as it bettered its previous record high of $3,674 set on September 9 in the wake of disappointing QCEW report that showed a massive downside revision of 911K jobs in the twelve months through March 2025.The MCX October gold contract at Rs 110,294 was up by around 0.90%.
- In the week ending September 12, spot gold posted a weekly gain of 1.58%, extending its weekly winning streak to the fourth straight week, as it closed at $3,643.
Data roundup:
- China’s data released on Monday were disappointing. Retail sales grew 3.4% on year in August, down from 3.7% in the previous month, and lower than the forecast of 3.8%, while expansion in fixed-asset investment in the first eight months of the year decelerated sharply to 0.5%, the worst reading for the period on record except for the Covid period in 2020. China’s data cast a doubt on the possibility of the Chinese government’s GDP growth target of 5% unless more stimulus measures are announced. Industrial production expanded 5.2%, the smallest gain since August 2024, as compared with the forecast of 5.6% and the prior data of 5.7%.
- The European Union’s surplus in goods trade with the US declined from Euro 11.20 billion in June to Euro 10.70 billion July, which is expected to weaken the region’s 3Q 2025 GDP growth.
- US Empire manufacturing (September) came in at -8.70 Vs the forecast of 5, thus, posting the worst reading since June.
Trade and tariff:
- US-China talks headed into the second day as representatives of both the nations discussed TikTok, national security issues, trade and economy in Madrid. They are also trying to work out a potential meeting between Trump and Xi in October. China’s delegation will be in Spain until September 17.
- Reportedly, a TikTok deal has been reached and there could be telephonic conversation between Xi and Trump on September 19.
- Over the weekend, Chinese officials began an anti-dumping investigation into certain US chips which are used mostly in smartphones and electric vehicles.
- India and the US will hold trade talks in New Delhi on September 16 to sort out their differences over trade matters.
US Dollar Index and yields:
- At the time of writing this article, the US Dollar Index at 97.30 was down nearly 0.30%. The Index slipped ahead of the US Federal Reserve’s monetary policy decision due on September 17. Apart from the Fed, three other key central banks – Bank of England, Bank of Canada and Bank of Japan, are also set to announce their monetary policies this week.
- MSCI emerging market currency index was up around 0.20%.
- Two-year US yields fell 2 bps to 3.53% while ten-year US yields at 4.03% were down nearly 3 bps.
Thai authorities to tax gold to slow down currency appreciation:
- Thai authorities are discussing ways to tax gold bought and sold as they try to stem a domestic currency rally, up nearly 7% this year, that they find is being driven by bullion shipments also
Gold surpasses inflation-adjusted record high in 1980:
- Adjusting for over four decades of inflation the spot price of gold has surpassed its inflation-adjusted peak of $850 set on January 21, 1980, which comes to be around $3590, though there could be some differences in that price level depending on the ways of adjusting inflation.
Gold ETF:
- As of September 12, total known global gold ETF holdings stood at 94.61 MOz as holdings rose for the second straight week.
- Gold ETF holdings, currently at the highest level since November 2022, are up 365 tons this year/14.19% YTD.
Fitch Ratings downgrades France’s sovereign credit rating:
- Rating agency Fitch downgraded France’s sovereign credit rating on Friday by one notch from ‘AA-‘ to ‘A+’ with a stable outlook. The rating agency cited growing political division and polarization, which increases the possibility of further delay to fiscal consolidation, as the reasons leading to the downgrade.
Upcoming data:
- Major Eurozone data on tap include ZEW Survey expectations (September) and industrial production (July). The UK’s monthly job report for the month of July will also be out today.
- Major US data on cards include retail sales advance (August), industrial production (August), NAHB housing market index (September) and import and export price Indices (August).
Gold Price Outlook:
- The current week is a crucial week for the markets as the US Fed will announce its monetary policy on September 17. It is widely expected that the Central Bank will slash the overnight Fed fund rate by 25 bps to 4.25%-4.50% range, though there is a slight possibility of a 50-bps cut, too. Investors expect the Fed to cut rates by 75 bps by the end of the year.
- Stronger than expected US retail sales data due today will lead to a profit booking.
- The FOMC’s rate decision could be a 25-bps hawkish cut; thus, gold in that case can correct lower. Nonetheless, as the US labour market is seeing disconcerting cracks propagating across it, the downside is expected to be limited.
- Gold is likely to rise to $3,800 (Rs 134,000) in the coming months.
- Support is at $3,600 (Rs 107,900)/$3,550 (Rs 106,400)/$3,500 (Rs 104,900). Interim resistance is at $3,700 (Rs 110,900).
- Buying the dips is favoured over chasing the rally at current prices.
(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)
