Gold prices moved higher on Tuesday, with spot gold touching an intraday high of $4,082 per ounce as the precious metal continued its recovery after last week’s decline below the key $4,000 level.
According to Kaynat Chainwala, AVP Commodity Research, Kotak Securities, gold has gained support from ongoing uncertainty in global markets, particularly due to the prolonged US-West Asia standoff and rising concerns over energy supply disruptions.
Tensions in the energy market have increased after threats to Saudi shipping added further risk premium to crude oil prices. This has kept inflation expectations elevated and created challenges for the US Federal Reserve, especially with Treasury yields remaining high and expectations of a September rate hike staying near 60%.
However, reports of a possible 10-day ceasefire have provided some relief to markets by reducing fears of a major energy disruption. A stable truce could ease inflation concerns, reduce pressure on the Federal Reserve to maintain a hawkish stance, and provide further support to gold prices.
Chainwala said the next major test for gold will depend on developments in the geopolitical situation. A confirmed ceasefire could push prices towards the $4,080–$4,100 per ounce zone and beyond.
On the other hand, any breakdown in negotiations or fresh escalation could revive inflation concerns and limit gold’s upside, potentially pulling prices back below the $4,000 mark.
Investors are closely tracking geopolitical developments and central bank policy signals for further direction in gold markets.
