Gold prices increased by ₹76 to ₹70,775 per 10 grams in futures trading, as speculators took new positions due to strong spot demand, on Wednesday. On the Multi Commodity Exchange, gold contracts for October delivery saw a rise of ₹76, or 0.11%, reaching ₹70,775 per 10 grams, with a business turnover of 17,397 lots.

Gold's outlook remains positive, despite increasing volatility. Depending on the impact of rate cuts, if the Fed implements a 50 basis point reduction, a significant rally in the metals market can be expected.

| Gold declines as expectations for rate cuts fade following US CPI data

On the geopolitical front, escalating tensions in mid east are also supporting gold prices. The U.S. benchmark 10-year Treasury yield also slipped, making non-yielding bullion more attractive. While U.S. dollar also edged lower. Additionally, central banks are shifting dollar reserves into gold, boosting its price.

In July this year, the precious metal soared to a record high of $2,480 in international spot gold markets, driving the cost of the yellow metal to unprecedented levels in the Indian market as well, reaching over 75,000 per 10 grams.

However, on July 23, the day of the budget announcement, gold prices on the MCX plummeted by more than ₹4,000, reaching approximately ₹68,500 per 10 grams. This significant drop was a direct response to the customs duty reduction, intended to stimulate domestic demand and reduce smuggling.

Can gold again reach ₹75,000 mark?

Hareesh V, Head of Commodities, Geojit Financial Services, said, that the Indian gold prices are highly correlated with overseas market and hence factors like geopolitical tensions, US policy decisions, performance of the US dollar, central bank buying, and the global growth outlook would influence the future price movements. In addition, the performance of Indian Rupee and variations in domestic demand may also affect the local gold prices.

| Gold Rate Today: Yellow metal gets cheaper; silver price above ₹81,100 per kg

Meanwhile, Rahul Kalantri, VP commodities at Mehta Equities Ltd, believes that the precious metal is likely to cross ₹75,000 mark in near-term.

“All prevailing factors suggest a strong upward trend for gold prices. We expect that gold could potentially cross the 75,000 mark in the near to mid-term future,” Kalantri said.