“In the past year, gold has provided opportunities for both bulls and bears, as well as improved value for investors’ money. Bullions’ luster was shortly removed by a major central bank’s aggressive rate hike, but recent developments regarding geopolitical concerns, anticipations of a change in the existing monetary policy attitude, and central banks’ gold-buying binge all contributed to a strong support for gold prices. There are undoubtedly certain headwinds that the metal is facing, like expectations of a softer landing, additional rate increases, an ease in geopolitical tensions, and higher real rates that could limit gains in the metal. An ease off in recent Middle East dispute and/or hawkish statements from Fed in the recent policy meeting, gold prices could witness a correction. However, above factors will have a hangover for longer than expected and will keep the party going for gold bulls helping it guide towards our medium target of Rs. 63,000. Similarly, buy on dips stance can be maintained for silver as well. There are many investment avenues for market participant’s w.r.t gold, along with Sovereign Gold Bond (SGB), we also have option of Gold ETF, Digital Gold, physical or trading in the market depending on the investors risk profile.”
– Manav Modi, Analyst, Commodities & Currencies, Motilal Oswal Financial Services.