Gold price retraces ₹2000 from record high. Should you buy on US recession fear, safe-haven demand, Gaza crisis? | Stock Market News

Gold rate today: After climbing to a new peak of ₹89,796 per 10 gm, MCX gold rate witnessed some profit-booking during weekend sessions, ending around ₹2,000 lower at ₹87,785 per 10 gm, logging over 14% YTD rally. In the international market, spot gold prices finished at $3,023.63 per ounce after hitting a new peak of $3,057.50. While finishing at $3,057.50 per ounce, spot gold price registered around 15% rise in 2025.

According to market experts, gold prices registered a strong rally at the beginning of last week’s sessions due to rising safe-haven demand for the yellow metal, rising geopolitical tension in Gaza, and renewed fear of the US recession. They said that the outcome of the US Fed meeting also fueled gold prices as the American Central Bank projected slower economic growth and higher tariff-related inflation. They advised investors to maintain buy-on-dips if the precious bullion comes close to its floor price of ₹86,600 per 10 gm on MCX and $3,000 to $2,950 per ounce in the spot market.

Key triggers for gold price rally

Speaking on the reason for gold prices’ rise, Sugandha Sachdeva, Founder of SS WealthStreet, said, “The steep surge in gold prices can be attributed to its sustained safe-haven demand amid escalating tensions in Gaza and increasing recession concerns in the US, fueled by the tariff war under the Trump administration, which have bolstered gold’s appeal. The steep drop in the dollar index has also been acting as a tailwind for gold.”

US recession fear

Pointing towards the US Fed meeting outcome, Sugandha Sachdeva said, “The key catalyst driving gold prices higher for the week was the US Fed meeting outcome where the US central bank decided to keep the benchmark interest rate unchanged at 4.25% to 4.5%. Gold prices initially boosted as the Fed Chair indicated two rate cuts this year, even as he projected slower economic growth and higher tariff-related inflation. Lower interest rates enhance gold’s attractiveness as a non-yielding asset. However, the US dollar regained some lost ground towards the close of the week and jumped to a two-week high as hopes of two rate cuts have eased recession risks in the US economy.”

Dovish guidance by the Bank of England

The Bank of England also kept its interest rate steady at 4.5% while indicating further reductions later this year. Besides, US Retail sales experienced a slight recovery in February, rising by 0.2% compared to a previous decline of 1.2%. This growth, however, was below the forecasted 0.6%, reflecting heightened uncertainty related to tariffs and significant job cuts among federal employees.

Asked about the reason that triggered profit-booking in gold prices, Jateen Trivedi, VP Research — Commodity & Currency at LKP Securities, said, “Gold continued to witness profit booking as rupee strength pressured MCX prices below ₹88,100, testing the crucial ₹88,000 zone. In Comex, gold also showed signs of weakness, slipping by $5, with persistent rejection near the $3,050 mark over the past few days. Before any fresh upside, the gold price may test lower support zones around $2,950–$2,965, as risk sentiment stabilises globally, reducing the premium on uncertainty.”

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“The pullback can be attributed to a surge in the dollar index to a two-week high on resilient economic data, including lower-than-expected jobless claims and an unexpected rise in February existing home sales. Gold jumped to an all-time high after the Fed’s dot plot showed that FOMC members expect the benchmark federal funds rate to be around 3.9% by the end of 2025, indicating they foresee a half-percentage-point rate reduction through next year. Market expectations for a May rate cut stand at 16.6% while traders are almost certain of a June reduction,” Kotak Securities said.

Expecting a bounce back in gold prices from lower levels, Kotak Securities said, “COMEX Gold holds below $3,040/oz, but the sharp downside may be limited as safe-haven bids from concerns about the potential impacts of Trump’s tariffs and tense geopolitical situation in the Middle East provide support. Markets remain on edge as Trump recently said both broad reciprocal tariffs and certain additional sector-specific tariffs would come into force on April 2.”

Gold rate today: Key triggers in upcoming sessions

On factors that may dictate gold price movement in the near term, Sugandha Sachdeva said, “For the coming week, investors will keep an eye on data like US Manufacturing and Services PMI, Q4 GDP numbers and PCE price index for February that will provide further cues for the precious metal. Trump’s fluctuating tariff decisions will also remain in focus. The US President will impose a 25% tariff on imports from Mexico and Canada on April 02.”

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts, consider individual risk tolerance, and conduct thorough research before making investment decisions, as market conditions can change rapidly, and individual circumstances may vary.