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Gold Prices Likely To Dip Further: Report
Published : Nov 13, 2024, 1:51 pm IST
Updated : Nov 13, 2024, 1:51 pm IST
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Gold Prices Likely To Dip Further: Report
Gold Prices Likely To Dip Further: Report

Despite these headwinds, certain fundamentals still favor gold.

Gold Prices in India Latest News Today: Gold’s strong rally this year has hit a temporary roadblock, attributed to rising U.S. bond yields, a stronger dollar, and increased interest in stocks and cryptocurrencies, according to a report from the World Gold Council.

The recent U.S. election outcome has softened gold’s momentum, easing some geopolitical tensions and reducing its appeal as a safe-haven asset. Pre-election speculation suggested a weaker dollar and lower bond yields might follow, potentially favoring gold. However, the dollar surged post-election as the euro and yen declined, while bond yields spiked, driven by expectations that the new administration’s policies—such as tariffs, tax cuts, and infrastructure spending—could increase government debt and fuel inflation.

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Bond yields are now reflecting a demand for higher returns on U.S. Treasuries, which has diminished gold's shine. The election has also added allure to cryptocurrencies, given the administration’s pro-crypto stance, while equity markets, especially tech stocks, saw a boost in anticipation of business-friendly policies. (Gold Prices in India Latest News Today)

Despite these headwinds, certain fundamentals still favor gold. Asian markets remain a strong source of demand, particularly as China’s declining CSI300 index and inflationary pressures from U.S. fiscal policies continue to shape investor behavior. Rising inflation in the U.S. also supports the case for holding gold.

Although the election results and rising yields have created near-term challenges, the broader environment—marked by rising protectionism, high stock valuations, and cryptocurrency's limited substitution for gold—indicates gold's long-term resilience. In a landscape of persistent inflation, ongoing global tensions, and concentrated stock markets, gold is likely to remain a vital asset for investors.

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