Gold price today: MCX Gold price opens lower on US rate cut recalibration; Middle East tensions in focus

Gold price today: MCX Gold price opened at ₹76,114 per 10 grams on Thursday, 3 October, 0.36 per cent lower than its previous close of ₹76,390 on Tuesday. The bullion further declined to ₹76,091 per 10 grams during the day despite rising tensions in the Middle East.

The commodity market remained closed on Wednesday on account of Gandhi Jayanti. 

Gold prices have seen a favourable trend led by interest rate cuts by the US Federal Reserve. The rising tensions between Iran and Israel in the Middle East are contributing to uncertainty in the region, which is likely to drive gold prices higher.

On September 12, the US Fed lowered benchmark rates by 50 basis points to begin its cycle of rate reductions. The central bank is widely expected to lower rates by a further 75–100 basis points this year.

Positive catalysts for gold prices thereby currently include geopolitical concerns, economic uncertainty, and rate reductions.

“Market participants are closely watching this data-packed week, with the prime focus on Non-Farm Payrolls and Unemployment data scheduled for Friday. The overall trend remains bullish, with support placed at ₹75,000 and resistance at ₹76,250- ₹76,400 in MCX. Any significant deviation in the data could impact gold's short-term movement,” said Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities.

US rate cut expectations recalibrated

On the US rate cut front, there has been some recalibration in market expectations regarding upcoming cuts following comments from Fed Chair Jerome Powell.

The Fed chief tempered expectations of aggressive interest rate cuts at the 66th NABE Annual Meeting that helped push the dollar higher towards the 101 level.

The CME FedWatch tool as per Tuesday data assigned a 61.8% probability to a 25 basis point rate cut at the November meeting, a significant increase from 46.7% just a day prior. However, Middle East tensions now have increased economic uncertainties and pushed oil prices higher, which could impact central banks' rate-cutting trajectory.

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