Gold may hit Rs. 78000 by 2024-end says Angel One

Gold prices are poised for further gains, targeting the $2800 per ounce mark. Long-term investors should consider accumulating at around $2300 per ounce. On the MCX, buying gold at approximately Rs 68,000 per 10 grams is advised, with a potential target of Rs 78,000 per 10 grams by the end of 2024.

Written by Guest

Updated: October 1, 2024 10:42 IST

Gold price outlook, Gold targe by 2024 end

While on the MCX prices moved in the range of Rs.75500-76500/10 gms i.e a range of around Rs.1000/10 gms. (Photo: Bloomberg)

By Prathamesh Mallya

The performance of gold is shining all throughout 2024 and the recent performance from the lows made on 25^th July in the international as well as domestic markets and the rise in momentum upwards of around 12 percent approximately ( on Comex as well as on the MCX) as on 27^th September 2024 suggests that these asset class holds a significant importance in an investor portfolio.

Gold prices have gained momentum in past few months on account of continuous buying of gold by the global central banks, rate cuts by the US FED, and the geopolitical uncertainty in the global markets, slowdown in the Chinese economy and recent measures by the Chinese central banks to boost the economy by a spate of monetary measures.

Interest rate cuts by the US Central banks

Gold’s rally has been fuelled on account of expectations of the rate cuts in the US by the US FED at least 3 times in 2024 as inflation has been benign and is slowly reaching the US Central Banks target zone of around 2 percent. Out of the expectations of three rate cuts in 2024, 50 basis rate cut happened in the recent meeting held in September 2024 and the interest rate now stands in the range of 4.75-5%.

China’s monetary stimulus signals anxiety

China’s central bank has lowered interest rates recently on 24^th September 2024 by reducing RRR ( Reserve Requirement Ratio) by 50 basis points injecting liquidity in to the system. This will release 1 trillion yuan ($142.5 billion) in liquidity into the banking system and was accompanied by a cut in the benchmark interest rate on seven-day reverse repurchase agreements by 20 bps to 1.50%.

The September meetings are not usually a forum for discussing the economy and this suggest growing anxiety among Chinese officials. Slowdown in Chinese economy is again a signal for global investors to boost their portfolio with the yellow metal and these monetary easing will continue in months to come indicating better returns in gold.

The next big event that will drive gold prices.

With double digit gains already in the year 2024, the important event that will drive gold prices further higher will come out of a combination of events starting from interest rate cuts in the US and further interest rates trajectory in Japan along with the outcome of the US elections.