Gold Rate in 2022: In the new year i.e. 2022, gold can be great for investors in terms of returns. According to a report in Economic Times, gold prices may cross the Rs 55,000 per 10 gram level in 2022 on the back of pandemic scare, inflation concerns and a strong US dollar. In the second half of 2021, significant weakness was registered in the yellow metal.
Gold is down 14% from all time high
Gold had touched a record level of Rs 56,200 on MCX on the back of a good rally in 2020 and in August this year, the prices were reduced to Rs 48,000 per 10 grams. Overall, it is down 14 per cent from its all-time high and 4 per cent from January 2021 levels.
Sentiment on gold may improve
Ganasekhara Thiagarajan, cofounder and CEO, Comtrendz, said the poor performance of gold this year was mainly due to excess liquidity in the equity markets. Thiagarajan said, “The fears of a rapid spread of the Omicron variant have increased the fears of COVID restrictions during the New Year holidays in many European countries. US health officials are urging US citizens to take a booster dose, wear a mask, and be cautious when traveling during winter holidays.” According to him, strictly on rates the US dollar will become attractive vis-a-vis other currencies.
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On December 29, spot gold in the international market stood at $ 1,791 per ounce, while in India, gold was at Rs 47,740 per 10 grams on MCX.
Thiagarajan said, the downside in the stock market and gold’s inflation hedge position gives it a lot of support on the downside. Also, if there is any kind of geo-political tension, then the sentiment regarding it may improve.
Will accelerate in the second half of 2022
Thiagarajan said, “We expect prices to be in the range of $1700-1900 an ounce in the first half of 2022 and expect it to cross the $2,000 level in the second half. On MCX in the domestic market, we can expect prices to remain in the range of 45,000-50,000 and cross 55,000 in the second half of 2022.”
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The impact of US inflation and real bond yields will be visible
HDFC Securities Senior Analyst (Commodities) Tapan Patel said gold may still see some upside due to rising US inflation and real bond yields. Talking about the long term trend, it has some resistance at $1,970 in 2022, he said. He said, “MCX Gold futures has short term resistance at Rs 49,200 and support at Rs 45,000. On the other hand, next year we expect it to go up to Rs 51,800 and see support at Rs 42,500.
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