Motilal Oswal Financial Services expects gold prices to touch ₹81,000 per 10 grams, as the price in the international market is expected to soar to $2,650 an ounce.

In its latest report, it said gold recorded a gain of about 14 per cent year-to-date in the domestic market and that of silver was 27 per cent.

MOFSL recommended “buy on dips” approach on gold when prices were hovering at ₹69,000 and $2,250 in the international market.

Navneet Damani, Group Senior VP – Commodity Research, Motilal Oswal Financial Services, said geopolitical tensions have added to the risk premium for gold as concerns about debt pose long-term challenges to overall growth. The economic indicators from the US continue to show strength in the economy. Additionally, along with central bank buying, festive and wedding-related domestic demand could boost sentiment. He says that although ETF buying is struggling, investment and central bank buying are maintaining strong demand momentum.

MOFSL feels market participants are closely watching the US central bank for hints regarding potential interest rate cuts, which have been keeping them on edge. Despite expectations for rate cuts earlier in the year, hawkish comments from Fed officials have tempered those beliefs, leading to a reduction in anticipated rate cuts from over four to about two for 2024.

However, MOFSL believes that the probability of a Fed rate cut has shifted gradually from March to May and June, and now to September.