Gold prices increased by 0.72% to Rs 1,21,111, buoyed by global economic uncertainty and robust anticipations of additional US rate cuts. The current US government shutdown, which has extended following several unsuccessful funding bills, has left markets without crucial economic data, thereby bolstering demand for safe-haven assets. Market participants are anticipating 25-basis-point reductions in the Federal Reserve’s interest rates for October and December, with probabilities of 93% and 82%, respectively, thereby enhancing the attractiveness of gold.

The political instability observed in France and Japan has contributed to the prevailing global risk sentiment. Investment demand has shown resilience following Goldman Sachs’ upward revision of its December 2026 gold forecast to $4,900 per ounce, attributing this shift to persistent ETF inflows and acquisitions by central banks. China’s central bank has notably increased its gold holdings for the 11th consecutive month, with reserves reaching 74.06 million ounces by the end of September.

In India, the demand for physical gold increased even in the face of record prices, propelled by festive purchasing activities, while imports of gold and silver saw a near doubling in September. Swiss exports of gold to China experienced a remarkable increase of 254%, reaching 35 tons, while exports to India climbed to 15.2 tons, indicative of robust demand from Asia. In the interim, there was a significant decline in exports to the U.S. due to uncertainties surrounding import tariffs.

From a technical perspective, the market is experiencing new buying activity, as evidenced by an increase in open interest of 1.14% to 15,964 lots. Gold exhibits support at Rs 1,20,240; a decline below this level may lead to a test of Rs 1,19,370. Conversely, resistance is identified at Rs 1,21,615. A decisive move above this level could propel prices toward Rs 1,22,120, indicating sustained bullish momentum in the near term.