Gold prices seen bullish by year-end amid dollar uncertainty, falling oil prices and strong investment demand: Analysts

Amit Gupta, Senior Research Analyst at Kedia Advisory Services, said several fundamental factors could support gold over the coming months, including Federal Reserve policy, central-bank purchases, gold exchange-traded fund (ETF) inflows and geopolitical uncertainty.

Central-bank buying remains one of the strongest structural supports, Gupta said, adding that a shift towards monetary easing or indications that the rate-hiking cycle had ended could reduce US Treasury yields and the opportunity cost of holding non-yielding gold.

He noted that the Federal Reserve held its target interest rate at 3.75-4.00 per cent on October 28, 2026, making its December policy decision and accompanying guidance important for gold prices.

On central-bank demand, Gupta cited purchases of 321 tonnes in Q3 2026, up 42 per cent year-on-year, taking January-September purchases to 675 tonnes, a 6 per cent increase. China and Poland were among the leading disclosed buyers. Global gold ETFs attracted 211 tonnes during Q3, taking total holdings to a record 4,256 tonnes.

Gupta also highlighted an 8 per cent year-on-year decline in global gold recycling to 314 tonnes in Q3, which could support the supply-demand balance. He advised existing long-term investors to maintain their strategic allocation rather than panic-selling during corrections, while recommending that fresh investors adopt staggered purchases through gold ETFs.

However, Gupta cautioned that a hawkish Federal Reserve, stronger US economic data, rising crude oil prices, ETF outflows and profit-booking could trigger another correction. He identified $3,800 as an important support level, warning that a weekly close below it would weaken the recovery outlook. The $4,155-$4,240 range represents a key resistance zone.

Anindya Banerjee, Head of Research at Kotak Neo, expects international gold prices to rise to $4,400-$4,450 per ounce by year-end, with domestic prices potentially touching Rs 1.50 lakh on the Multi Commodity Exchange (MCX).

By year-end we expect gold prices to rise from $4,100 to $4,400-$4,450 and around Rs 1.50 lakh on MCX, Banerjee told ANI.

Banerjee identified political crises in the United States that could undermine confidence in the US dollar, reduced risks of war in West Asia and falling crude oil prices as factors supporting gold. He said lower oil prices could reduce the risk of aggressive interest rate hikes by the US Federal Reserve.

Dinesh Somani, Proprietor of ProIntellitrade Services brokerage, also expects a recovery in gold prices, projecting international prices of $4,450-$4,500 by year-end. He said international gold had declined from a recent high of $4,700 to around $3,860 before recovering towards $4,120.

I think probably $3,860 should be the bottom for near term, at least for this year end. Upside target again expecting around $4,450 to $4,500 levels, Somani told ANI.

On the domestic market, Somani identified Rs 1,38,000 as the recent low and expects prices to find a near-term bottom around Rs 1,40,500-Rs 1,41,000, with an upside target of Rs 1,49,000. He said he did not expect prices to breach the recent low of Rs 1,38,000.

Somani attributed the price movement partly to geopolitical tensions and said a V-shaped recovery could be possible. He added that the Dollar Index was hovering around 102, while the rupee had appreciated from around 97 to below 94 against the US dollar and could move towards 92, potentially putting pressure on domestic gold prices. He also expects crude oil prices to decline further.

Gold recovered from its 2026 low of $3,869.85 recorded on October 30, after reaching a record high of $5,594.82 on January 29. (ANI)