Will Gold Prices Keep Rising? Analysts Weigh In On The Future Of The Bullish Trend

Gold Price Today: Gold prices have continued their upward rally, reaching new record highs for the fourth consecutive session on Tuesday. This surge is primarily fueled by strong safe-haven demand amidst rising global economic uncertainty and geopolitical tensions.

On the Multi Commodity Exchange (MCX), gold June contracts surged by Rs 1,899, or nearly 2%, hitting an all-time high of Rs 99,178 per 10 grams in early trading.

Later, the June contract traded slightly lower at Rs 98,880, still up by Rs 1,601 or 1.65%, with an open interest of 22,687 lots.

The bullish sentiment spread across other contracts as well. The August contract saw a jump of Rs 1,848, or 1.89%, hitting a new peak of Rs 99,800 per 10 grams. The October contract, in particular, breached the Rs 1 lakh mark for the first time, soaring by Rs 2,000, or 2%, to Rs 1,00,484 per 10 grams.

Geopolitical Tensions

On the global front, gold futures climbed to a fresh high of $3,504.12 per ounce before easing slightly to $3,490.72, still up by $65.42, or 1.91%. Analysts attribute the rally in gold prices to a combination of rising geopolitical tensions and concerns over U.S. monetary policy, particularly after President Donald Trump increased his pressure on the Federal Reserve.

Dr. Renisha Chainani, Head of Research at Augmont, explained the factors driving this surge: "There may be some big trigger that we don’t know, which will come up in a few days, that is supporting this rally," she said. "Gold has crossed the psychological level of $3500 (~Rs 99000) today, as the dollar fell to a three-year low below 98."

Also Read: Gold Rush 2025: Will Prices Hit Rs 1 Lakh Sooner Than Expected?

U.S.-China Tensions In Gold Price Surge

Chainani also pointed to President Trump's increasing criticism of the Federal Reserve, specifically its stance on interest rates. "Trump criticised Fed Chair Jerome Powell again on Monday, warning that the US economy will slow unless interest rates are cut promptly," she added.

Adding to the global tensions, China has ramped up its rhetoric against the US, accusing the country of abusing tariffs and warning governments not to make agreements that compromise Beijing's interests.

Will Gold Prices Keep Rising?

As Chainani further noted, "Gold showed very high price volatility amid uncertainty in the global markets. The dollar index slipped to 3-year lows after the US President Trump and Federal Reserve Chair Jerome Powell's tussle over interest rate cuts."

The situation has only heightened with White House economic advisor Kevin Hassett revealing last week that President Trump and his team were considering the possibility of firing Fed Chair Jerome Powell. However, Powell has maintained that the central bank is not inclined to cut interest rates shortly, citing potential inflationary pressures and economic uncertainties from new tariffs.

Will Gold’s Rally Continue?

Despite the gold rally, Chainani advised caution: "After touching $3500, positioning appears crowded in the short run, and technical indications suggest a near-term overbought condition. Therefore, one must exercise extreme caution because prices have skyrocketed relatively quickly. If prices fall below $3450 (Rs 97000), we may see a topping-out signal, and profit-booking can move prices southward to around $3300 (Rs 94000)."

With gold prices already up by 30% in 2025, the rally seems to be driven by a mix of economic fear, inflation expectations, and central bank uncertainty, keeping investors glued to gold as a safe investment in uncertain times.