Gold Jumps 1.17 Percent as Oil Prices Fall

Spot gold rose USD 50.96 to USD 4,392.78 per ounce on Friday. This marked a 1.17 percent gain. The metal extended its rally for a second consecutive session. Investors returned to bullion as macro pressures eased.

Domestic prices in India mirrored the global trend. Gold of 99.9 percent purity rose by Rs 1,600. The price reached Rs 1,56,600 per 10 grams in New Delhi. This followed a close at Rs 1.55 lakh per 10 grams on Thursday. The increase included all applicable taxes.

Crude oil decline supports demand

Crude oil prices fell for a third straight session. The benchmark price dropped to around USD 101 per barrel. Analysts noted that lower energy costs reduce inflation risks. This dynamic makes gold a more attractive hedge.

Expectations of restored Saudi oil supplies also contributed to the decline. Alternative shipping routes became available. These factors reduced immediate concerns about supply disruptions. Tensions in West Asia remain a residual risk factor.

Dollar strength limits upside potential

The US Federal Reserve maintained a hawkish monetary policy. Interest rate hikes continued to influence market sentiment. Higher US Treasury yields limited the extent of gold’s gains. The US dollar remained strong against major currencies.

Investors reassessed positions after the central bank's decision. The easing of the dollar and yields encouraged buying. Gold-backed exchange-traded funds saw net inflows for eight days. Total global holdings reached 100.39 million ounces.

Institutional flows drive market activity

Global ETF holdings increased by 1.44 million ounces this year. Praveen Singh of Mirae Asset Sharekhan highlighted this trend. The inflows indicate sustained institutional interest in the asset. Falling oil prices offset part of the impact from hawkish policy.

Gaurav Garg of Lemonn noted the recovery from recent sell-offs. The movement aligns with shifts in the US dollar and yields. The data is sourced from GN auto markets/commodities: gold prices. The market continues to balance inflation hedges against rising real yields.