Gold prices rose 0.13% to close at 86,024 on rising trade tensions. Inflation concerns have risen as a result of the US President’s tariff threats against several industries and his ongoing tariffs on Chinese imports and metals. The Federal Reserve’s cautious approach to interest rate cuts in the face of these inflationary pressures was reiterated at its latest meeting. Meanwhile, China’s domestic gold market sent mixed signals. Despite falling imports and negative ETF flows, the central bank increased its holdings for the third consecutive month to 2,285 tonnes.
Retail demand in India was hampered by record high costs, leading dealers to offer discounts of up to $26 per ounce. Similarly, gold was sold at a discount of $18 as demand in China eased during the Lunar New Year period. Japan, Singapore and Hong Kong also saw varying discounts and premiums due to demand. The World Gold Council has forecast that India’s gold consumption will decline in 2025, from a nine-year low of 802.8 tonnes to 700 to 800 metric tonnes, as rising prices put pressure on jewellery purchases.
