Gold prices are expected to maintain their positive momentum as India enters the festive season, according to recent research by Aditya Birla Sun Life AMC. The precious metal has shown remarkable performance in both international and domestic markets, driven by a combination of global economic factors and local demand.

Global Gold Market Trends

International gold prices experienced a significant uptick in August, rising over 1% to reach $3,335.00 per ounce. This surge can be attributed to several factors:

• Weakening of the US dollar
• Anticipation of potential rate cuts by the US Federal Reserve
• Persistent inflation concerns

The yellow metal has delivered an impressive 28.00% year-to-date return in the international market, highlighting its strong performance as a safe-haven asset.

Domestic Gold Market Performance

In the Indian market, gold has shown even more robust growth:

• Domestic gold prices climbed 1.60% in August, reaching ₹99,665.00 per 10 grams
• Year-to-date increase stands at a substantial 31.00%
• The rupee's weakness has played a role in narrowing domestic discounts from $27.00 per ounce in June to $3.70 per ounce by mid-August

Jewellery Market and Import Trends

The jewellery market in India remains optimistic as the festive season approaches:

• Manufacturers are actively restocking their inventories
• Focus has shifted towards lighter-weight designs to cater to changing consumer preferences
• Gold imports surged to $4.00 billion in July, indicating strong demand

Gold ETFs and RBI Reserves

The appeal of gold as an investment continues to grow:

• Gold ETF inflows remained strong at ₹1,260.00 crore in July
• Assets under management for gold ETFs have seen a 96.00% year-to-date increase
• The Reserve Bank of India's gold reserves held steady at 880.00 tonnes, accounting for about 12.00% of foreign exchange reserves

As India gears up for the festive season, the gold market appears well-positioned for continued growth. The combination of global economic factors, domestic demand, and traditional affinity for gold during festivals suggests that the precious metal may continue to shine in the coming months.

Gold prices remained stable following a two-day gain as markets grappled with concerns over Federal Reserve independence and potential U.S. inflation risks. The precious metal's stability comes in the wake of a controversial move by President Donald Trump that has sent ripples through the financial community.

Trump's Action Against Fed Governor

President Donald Trump has initiated steps to remove Federal Reserve Governor Lisa Cook from her position, citing allegations of falsifying mortgage documents. This move, if successful, would give Trump a significant advantage, securing a four-person majority on the Fed's seven-member board. However, Cook's lawyer has dismissed these allegations as baseless, adding another layer of complexity to the unfolding situation.

Market Reactions and Concerns

The financial markets have expressed growing concern over the potential erosion of Federal Reserve independence. Trump's repeated calls for interest rate cuts have raised eyebrows among investors and economists alike. There are fears that reduced Fed independence could potentially undermine investor confidence and accelerate inflation risks in the U.S. economy.

Gold Price Movements

In the midst of these developments, gold has shown resilience:

• The precious metal dipped slightly by 0.20% to $3,391.71 per ounce.
• Gold has been trading within a range since hitting a record high above $3,500 per ounce in April.
• The stability in gold prices reflects its status as a safe-haven asset during times of economic and political uncertainty.

Currency and Other Precious Metals

The broader financial landscape also saw some movements:

• The Bloomberg Dollar Spot Index declined by 0.10%, indicating a slight weakening of the U.S. dollar.
• Silver and palladium prices remained flat, showing little reaction to the current events.
• Platinum edged lower, though specific figures were not provided.

As the situation continues to unfold, market participants will be closely monitoring any developments regarding Federal Reserve independence and their potential impact on gold prices and broader economic indicators.