Festive Demand and US Inflation Data to Steer Gold Prices This Week: Analysts
Gold prices are expected to remain volatile in the coming week as traders weigh domestic festive demand and physical market premiums against key macroeconomic data releases and political developments in the US, analysts said. Investors will also closely monitor commentaries by Federal Reserve officials, including Chair Jerome Powell, on Tuesday, which will provide more cues on the trajectory of gold prices in the near term.
Domestic Festive Demand to Support Gold Prices
In the next week, focus will be on the physical demand for bullion during the festive season in India along with global political and geo-political developments, particularly the passage of the US spending bill and efforts to resume diplomacy on ending the Russia-Ukraine war. These factors are likely to shape gold price trends in the coming months, according to Pranav Mer, Vice President, EBG – Commodity & Currency Research, JM Financial Services Ltd.
Mer noted that gold prices closed yet another week on a positive note, but volatility remained elevated with sharp corrections followed by renewed buying at lower levels. This was expected and will continue as the bulls and bears fight out at market tops. For more information on gold price trends, please visit our website.
US Inflation Data to Influence Gold Prices
Last week, gold prices rallied by Rs 3,251, or 2.75%, hitting a record of Rs 1,23,677 per 10 grams on Thursday. However, the rally appeared to take a temporary breather towards the week’s close on the Multi-Commodity Exchange. For the latest updates on gold price analysis, please visit our website.
Gold prices have had an astonishing rally in recent months, with a year-to-date gain of more than 50% in 2025. This prompted investors to take profits on Thursday, triggering a price correction of more than Rs 3,000 from highs of Rs 1,23,677 per 10 grams, which contributed to extreme volatility in the yellow metal, according to Prathamesh Mallya, DVP- Research, Non-Agri Commodities and Currencies, Angel One.
US Monetary Policy to Shape Gold Prices
Market observers also cited US monetary policy as a key influence. Pankaj Singh, Founder and Principal Researcher of SmartWealth.ai, pointed out that minutes from the September Federal Open Market Committee meeting reinforced expectations of a prolonged inflationary bias and balance-sheet reduction, both of which supported gold prices. For more information on US monetary policy, please visit our website.
On the international front, Comex gold futures for December delivery closed marginally higher at $4,000.4 per ounce, after hitting $4,081 during midweek trading. Spot gold also rose by 1.06% to $4,018.30 per ounce before reaching a record $4,059.34 per ounce. For the latest updates on Comex gold futures, please visit our website.
Silver Prices Extend Historic Rally
Silver extended its historic rally, though with elevated volatility. On the MCX, silver prices rose by Rs 722, or 0.49% in the past week, touching an all-time high of Rs 1,53,388 per kilogram on Thursday. For more information on silver price trends, please visit our website.
Globally, Comex silver futures for December delivery hit a high of $49.96 per ounce on Friday, while spot silver briefly breached $51 per ounce on Thursday before retreating to close at $50.29 per ounce. Riya Singh of Emkay Global Financial Services said, Silver’s historic run reached a fever pitch last week, with spot prices climbing to $51.24 an ounce-mark on Thursday, the highest level since 1980, before correcting to around $50 amid intense volatility and supply constraints.
Outlook for Gold and Silver Prices
Despite the short-term cooling, analysts remain constructive on the broader trajectory. Gold is still on track for its eighth consecutive weekly advance, up nearly 14% this quarter, reflecting sustained investor preference for tangible assets amid concerns over US debt exceeding $36 trillion, and rising inflation expectations despite slowing economic growth, according to Singh.
Physical demand from Asia moderated last week, as high prices deterred fresh buying, particularly in China and India, where import premiums narrowed. The short-term outlook will now hinge on upcoming US inflation readings and Federal Reserve officials’ commentary, analysts said. For the latest updates on US inflation readings, please visit our website.