Spot gold continues to rise as geopolitical uncertainty grows
This story was originally published at 15:20 IST on 28 January 2026
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MUMBAI – Spot gold prices continued to rise Wednesday, tracking record high prices of futures on the Muti Commodity Exchange of India and the COMEX due to continuing geopolitical tensions. Prices also rose due to concern over a potential partial US government shutdown.
In the Mumbai spot market, the price of gold of 99.9% purity was INR 163,827 per 10 grams, higher than INR 159,027 per 10 grams Tuesday, said Kumar Jain, spokesperson for the India Bullion and Jewellers Association. Dealers are charging a premium of INR 170 per 10 grams on gold prices, jewellers said.
Tensions between the US and Iran lingered, with the US announcing plans to hold a multi-day military exercise in West Asia as it deploys what US President Donald Trump has called an "armada" led by the USS Abraham Lincoln to the region as part of a tense standoff with Iran. On Wednesday, Trump said that another "armada" was moving towards Iran and expressed hope that Tehran would agree to a deal with Washington. "By the way, there's another beautiful armada floating toward Iran right now. So we'll see. I hope they make a deal," Trump said speaking at a public event.
Gold prices edged higher amid concern over a potential partial US government shutdown starting Saturday, after the killing of a US citizen by federal agents in Minneapolis prompted Senate Democrats to seek changes to homeland security provisions in the proposed government funding bill.
Meanwhile, market participants' focus will now be on the Federal Reserve's policy decision at 0030 IST Thursday, with expectations that the Fed will keep rates unchanged, which could weigh on gold prices. "More focus will be on statements to get cues on future rate path. Moreover, concern over Fed independence and strong central bank buying would be supportive for the prices," ICICI Direct said in a report. "Trump also added that he will soon announce his pick to serve as head of the US central bank, and predicted interest rates would decline once the new chair takes over," SMC Global Securities said in a report. End
Reported by Reshma Ravi
Edited by Akul Nishant Akhoury
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