Gold prices in India have shot up by as much as Rs 4,150 per 10 grams during October to touch the Rs 60,825 mark on Friday from Rs 56,675 on October 3, according to figures compiled by the Indian Bullion and Jewellers Association.
The sharp increase in the price of the yellow metal comes ahead of the auspicious Dhanteras occasion for buying gold on November 10, as well as the approaching festive and wedding season when the demand for jewellery shoots up.
In the international market, too, gold prices have surged above $2,000 an ounce during the week, making it the third consecutive weekly gain, as geopolitical tensions rise amid the Israel-Hamas war.
According to market analysts this has spurred the demand for gold as a safe-haven investment.
Kama Jewelry MD Colin Shah expects the demand for gold to remain buoyant due to the strong "sentimental value" attached towards buying gold during the festive season and the Indian culture of gifting jewellery during weddings.
The recent volatility in the stock markets has also prompted investors to look at a safer bet and gold appears to be the ideal asset. Besides, the gold also provides a hedge against the strengthening dollar as the rupee has been weakening, said a senior bank official.
As the Israel-Hamas war threatens to escalate into a wider geopolitical conflict involving the US and Iran, spot gold price hit $2,000 levels on Friday and closed at 2,006 per ounce levels.
Gold future contract on Multi Commodity Exchange (MCX) for December 2023 expiry surged Rs 308 per gm and ended at Rs 61,260 levels on Friday.