Gold price today: MCX Gold hits record high on tariff uncertainty; US Fed policy in focus; can it hit ₹1 lakh mark soon?

Gold price today: Gold prices soared to record highs in the domestic futures market Tuesday morning amid heightened uncertainty over the economic impact of US President Donald Trump's tariff policies. MCX Gold for the April 4 contract scaled a fresh all-time high of ₹88,672 on March 18. Around 3:50 PM, the yellow metal traded 0.65 per cent higher at ₹88,595 per 10 grams.

International gold prices hit a record high of $3,037.60 per ounce earlier in the session as investors rushed to safe-haven assets amid concerns over a severe economic fallout from Trump's aggressive tariff policies.

Focus now shifts to the policy outcome of the US Federal Open Market Committee (FOMC) on March 19. The US Federal Reserve is expected to keep the policy rates unchanged. Experts believe a hawkish Fed may weigh on gold prices.

Gold prices tend to rise during times of economic uncertainty. However, elevated interest rates are negative for the yellow metal. Due to higher rates, fixed-income assets like bonds and savings accounts offer better returns, making gold less attractive to investors.

Why are gold prices hitting record highs?

A confluence of factors has supported gold prices. The key among them is the risk of an economic slowdown due to a trade war caused by Trump's tariff policies. Gold is considered a safe-haven asset, a hedge against inflation and economic uncertainty.

Another factor is the decline in the dollar index. Since gold is priced in the US dollar, a decline in the US currency makes the yellow metal cheaper in other currencies, enhancing its demand.

Another factor is the strong central bank buying. Major central banks worldwide have been aggressively buying gold in recent years.

"Several factors are driving gold prices higher. One significant factor is the decline in the dollar index. Despite mixed-to-positive macroeconomic indicators, the dollar index has remained sluggish, falling from 107 to approximately 103.50. Additionally, uncertainty surrounding the tariff war is fueling investor anxiety, further supporting gold prices," said Manav Modi, Senior Analyst, Commodity Research at Motilal Oswal Financial Services.

"Gold demand remains strong. Last year, domestic imports of both gold and silver surged, and this year has started on a similarly strong note. Central bank purchases have also been consistent, providing additional support to prices," Modi said.

Can MCX Gold hit ₹1,00,000 mark in the near term?

While the overall outlook for gold remains positive, experts say it is unlikely that the yellow metal will soon reach the coveted ₹1,00,000 per 10 grams.

According to Modi of Motilal Oswal, gold prices may rise to $3,100 soon and consolidate around this level throughout the year. In Indian rupees, gold could reach ₹91,500-92,000, but it is unlikely to touch the ₹1,00,000 mark this year.

"The yellow metal may take two to three years to reach the ₹1,00,000 level. It has delivered a compound annual growth rate (CAGR) of around 10 per cent over the past five to ten years. Based on this trend, gold may hit ₹1,00,000 within the next two to three years," said Modi.

NS Ramaswamy, the head of the commodity desk at Ventura, said for gold to touch the magical milestone of ₹1,00,000 in the domestic market, international gold prices must rise to the $3,300 an ounce mark, and USDINR should hit the 89 level. This seems unlikely at this juncture.

"The possibility of gold touching ₹1,00,000 mark stems from either the international gold prices touching $3,300 an ounce and USDINR coming at 89 levels. For the year 2025, even if the international prices were to cross this number, rupee weakness in the USDINR pair should be anywhere in the range of 88 or 89. Only with a combination of these two, we could see gold in the domestic markets crossing ₹1,00,000, which seems unlikely for the year 2025," said Ramaswamy.

Rahul Kalantri, VP of commodities at Mehta Equities, also believes gold could reach ₹1,00,000 per 10 grams in the coming years. However, achieving this milestone within 2025 remains uncertain, as several key factors will influence the timeline.

"The metal’s strong uptrend is driven by global economic uncertainties, inflation, and central bank policies," said Kalantri.

Kalantri believes gold could gradually move towards ₹1,00,000 per 10 grams in the next one to two years. However, short-term corrections and volatility are likely along the way.

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Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.