Gold Hits Record High Amid US Election Uncertainty and BRICS De-dollarisation Push

Gold prices fluctuated between gains and losses in the domestic futures market on October 23, 2024 morning, due to a stronger US dollar and rising bond yields. Despite this, MCX Gold for December 5 expiry delivery reached a new record high of ₹78,755 per 10 grams, trading at that level around 10:10 am.

Uncertainty around the 2024 US election and expectations of interest rate cuts by the US Federal Reserve pushed the dollar to its highest point in over 2 months, while treasury yields rose to their highest since July, putting pressure on gold.

Gold is priced in US dollars worldwide. When the dollar gets stronger, gold becomes more expensive for other currencies, lowering demand and causing prices to drop. Similarly, rising government bond yields also push gold prices down. Since gold doesn’t pay interest or dividends, it becomes less appealing when bond yields rise, as investors tend to move money from gold to bonds for guaranteed returns.

Gold has delivered strong returns this year, driven by geopolitical uncertainty, expected rate cuts, a steady dollar index, and increased central bank buying. Experts remain positive about gold’s outlook due to ongoing global tensions and expected US Fed rate cuts.

The upcoming US election will also play a major role in gold prices. If former President Donald Trump wins, changes in fiscal policies, tariffs, and monetary strategies could create market volatility.

Uncertainty about the upcoming US presidential election and the BRICS nations’ efforts to move away from the US dollar are boosting demand for precious metals. As the election approaches, rising unpredictability around Kamala Harris’s chances is adding to the appeal of gold and silver as safe-haven investments.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.