Gold futures on the Multi Commodity Exchange climbed by ₹264 to ₹1,58,260 per 10 grams, supported by a weaker US dollar and easing US Treasury yields. International market factors, including US monetary policy developments and geopolitical tensions, continue to influence bullion demand.

Gold prices increased by ₹264 in futures trade, reaching ₹1,58,260 per 10 grams on Thursday, driven by firm global cues and a decline in the US dollar that boosted demand for bullion.

On the Multi Commodity Exchange (MCX), yellow metal futures for October delivery moved up by 0.17 per cent, recording a business turnover of 10,450 lots. Market analysts noted that easing US Treasury yields alongside a weaker dollar provided support to gold prices. However, persistent inflation concerns, elevated crude oil prices, and ongoing geopolitical tensions continued to cap potential upside movements for the precious metal.

In international markets, Comex gold futures for the December contract traded flat at USD 4,546 per ounce in New York.

Manav Modi, Commodities Analyst at Motilal Oswal Financial Services Ltd, stated that gold hovered above USD 4,500 for the first time since early June following the sharp decline in US Treasury yields and the dollar.

The US Treasury recently announced plans to double its buyback operations for longer-dated bonds from USD 2 billion to USD 4 billion per operation, effective September 9, aimed at providing liquidity support to the long end of the market. According to Modi, this policy shift pushed the 30-year US Treasury yield down from near two-decade highs to approximately 5.19 per cent.

While this move weakened the dollar and relieved pressure on gold, it also reflected broader concerns surrounding elevated long-term borrowing costs and rising government debt levels.

Meanwhile, minutes from the Federal Reserve's July meeting indicated that policymakers remain cautious about persistent inflation. Several officials suggested that additional rate hikes could be implemented if price pressures fail to ease. The minutes also pointed to potential inflation risks arising from the West Asia conflict and prolonged supply chain disruptions.

Modi noted that safe-haven demand for gold continues to surge as a result of easing long-term yields, a weakening dollar, and fiscal concerns driving interest in alternative stores of value. Market participants are now awaiting upcoming US economic data, including weekly jobless claims and the Philadelphia Fed manufacturing index.

"The recent movement in gold prices highlights how global macroeconomic factors, particularly shifts in US monetary policy and treasury yields, directly impact commodity markets. For businesses and entrepreneurs, currency fluctuations and shifting borrowing costs serve as important reminders to maintain disciplined financial planning and risk management strategies during periods of economic uncertainty." — Dr. Shishir Gupta, Founder & CEO, StartupLanes

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