Donald Trump’s return to White House may boost gold prices amid geopolitical turmoil | Mint
Source: Live Mint
Donald Trump’s potential return to the White House is expected to intensify global trade tensions, fueling geopolitical crises and likely pushing gold prices higher.
Gold has already delivered a robust return of around 21 per cent year-to-date, significantly outperforming benchmarks like the Nifty 50, BSE Sensex, and Bank Nifty, as well as surpassing inflation, according to a report by Mint. Trump’s presidency may sustain this upward momentum for gold, given its status as a safe-haven asset amid uncertainty.
“Trade tensions, potential conflicts, and unpredictable policies under his leadership might drive investors toward gold as a safe-haven asset,” the report quoted the managing director of RiddiSiddhi Bullions Limited as saying.
Geopolitical Tensions and Market Impact
Analysts are bracing for heightened geopolitical tensions during Trump’s second term, which could disrupt the stock market. “During Trump 2.0, especially in the first year of his second tenure, the stock market is expected to receive various hits due to the geopolitical tension,” said Anuj Gupta, Head of Commodity & Currency at HDFC Securities. “In such conditions, gold prices normally rise.”
However, Gupta noted that stubbornly high U.S. dollar rates might moderate the expected increase in gold prices.
2025 Market Outlook
Indian equity markets, including the Nifty 50, BSE Sensex, and Bank Nifty, may also face hurdles in 2025 due to factors like rising U.S. Treasury yields, the strength of the U.S. dollar, and competition from digital assets like Bitcoin, Gupta said.
Looking ahead, Gupta offered insights on gold’s short-term performance. “In the short-term, the MCX gold rate faces resistance at ₹76,800 per 10 grams. On breaching above this hurdle, the yellow metal may touch the ₹78,000 mark,” he predicted.
On December 27, gold prices jumped ₹350 to ₹79,200 per 10 grams in the national capital on Friday on the back of continued buying by jewellers and depreciation in the rupee, according to All India Sarafa Association.
Traders said the safe-haven asset is also strengthened by escalating geopolitical tensions stemming from the ongoing Russia-Ukraine war and tensions in the Middle East.
The yellow metal on Thursday settled at ₹78,850 per 10 grams.
Rallying for the fourth straight session, silver also surged ₹900 to ₹91,700 per kg. During the holiday-shortened week, the white metal soared ₹3,550 per kg in the past four sessions.
