Will gold continue to glitter until the next Dhanteras?
Dhanteras is among the favourites. In India, people invest in Gold for long-term gains. That is why Indian households have the highest reserves of Gold, roughly 21000 tonnes.
Gold is very close to Indian's hearts and is a more sentimental investment than a speculative one. Since Dhanteras last year, Gold has given a mind-boggling return of almost 20 per cent, easily beating the returns of the Nifty 50.
Gold was lingering due to the strong dollar index and the hawkish stance of the Fed at the end of September.
It trapped all the bears as war broke out between Israel and Hamas. This geopolitical tension in the Middle East boosted Gold prices as it gained almost 10 per cent from the recent swing lows and made a multi-month high of 61500 level as investors flocked towards Gold due to its safe-haven appeal.
Let's discuss the factors that can affect Gold prices if investors want to add Gold to their portfolio for one year. The main factor that shook the Bullion prices was the monetary tightening of the Fed.
Gold lost almost 10 per cent from 55000 down to the 49000 level when the Fed started hiking the rates, and the dollar index started its upward rally. Gold prices and the dollar index are inversely correlated in nature.
However, Gold prices defied the sky-high interest rates and proved why it would remain the king during geopolitical tension along with the greenback.
Gold prices have digested the multi-year high rates and are getting ready to roar in 2024 as the stage is set for it to rally higher.
Central banks are hoarding Gold at every dip. Last year, the central bank piled more than 1000 tonnes of Gold.
