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Informist, Wednesday, Aug. 5, 2026

 

By Afra Abubacker 

 

NEW DELHI – Gold prices are expected to consolidate in August after rising slightly in July amid easing inflation worries and a softer dollar, analysts said. In addition, expectations of a slowdown in the US jobs market would weigh on bets about interest rate hikes, supporting the price of the yellow metal, which does not offer any interest, they added. 

 

In August, the most-active October gold futures contract on the Multi Commodity Exchange of India is expected in the range of INR 139,800-INR 146,000 per 10 grams, as per the median of nine estimates from broking firms polled by Informist. On COMEX, gold is seen around $3,950-$4,200 per ounce during the month. At the time of writing, the October contract on COMEX was up 1.5% at $4,184.5 per ounce.

 

Most analysts expect gold prices to consolidate with a mild upward bias in August. They attributed lower US Treasury yields, dollar weakness, continued central bank diversification, investment demand, and increased buying in Asian markets as factors supporting the price of gold.

 

Shubhada Patil, founder and managing director of Quantace Research, expects gold prices to be around $3,950-$4,300, with a modest bullish bias in August. If lower yields, dollar weakness, or renewed hedging demand drive a break above $4,300, gold prices may open to $4,400-$4,500 levels, she added. However, a "sustained close" below $3,900 would "invalidate the constructive view" and expose prices to $3,700-$3,550 levels, she added.

 

Arthavrksh Financial Services founder Ravindra Rao said gold prices are largely forming a base. "We might see a breakout, but that breakout is still quite far," he said, adding that the initial breakout for a directional move is placed at $4,200, and for sustained upward momentum around $4,400. On the lower side, Rao said gold prices are unlikely to see a major downside in August and placed strong support at $3,950-$3,900.

 

In July, gold prices rose over 0.6% on COMEX, snapping a four-month losing streak, as the US Federal Reserve and other major central banks did not raise interest rates. However, Indian gold prices fell nearly 1% on MCX, as the rupee appreciated from May's record lows and spot discounts widened due to reduced demand. 

 

Arthavrksh's Rao attributed this recurring divergence from COMEX to the rupee's movements, spot discounts, and liquidity tightness in major gold contracts. "I would say this divergence has been seen for a few months now. The major factor should have been the currency factor; the other is premiums and discounts going on in the spot markets," he said, adding that people were moving towards mini gold contracts due to margin pressures.

Quantace's Patil largely concurred. "The divergence was largely a currency-and-basis effect, compounded by contract-comparison issues," she said. Rupee appreciation and ample local supplies can dilute gains in global prices. "India's gold market remained at a discount to landed value in July amid adequate domestic supply and subdued consumer demand," she added. 

 

According to experts, India's gold demand has weakened after New Delhi raised import duty on the bullion metal to 15% from 6% in May. Jewellers have been offering discounts to attract consumers amid reduced footfalls and availability of inventories imported before the hike. India's net bullion imports declined 22% on year to 98 tonnes during Apr-Jun, according to the World Gold Council. Despite lower imports, supply remained adequate due to recycling of old gold and comfortable inventories.

 

While analysts do not see gold demand recovering meaningfully in August, most said MCX prices are likely to consolidate with an upward bias, even if not in parity with COMEX. Patil said she does not expect "a sustained directional decoupling" on MCX, but monthly returns could differ marginally. A weaker rupee would amplify COMEX gains or cushion losses while rupee appreciation may dilute the gains in COMEX prices, they added.

 

Patil sees MCX gold prices ranging around INR 140,000-INR 151,000 per 10 grams in August, with a mild upward bias. "COMEX should determine direction, while USD/INR determines the magnitude of the domestic move," she said. "Persistent local discounts may limit pass-through from global prices, but a break above INR 151,000 could extend toward INR 155,000–INR 158,000 if both COMEX and the currency are supportive," she added.

 

Analysts said September will define the gold price trajectory in the near term. For the US Federal Reserve's September meeting, 59% of traders expect the Fed to raise interest rates by 25 bps, up from 46% last month, according to the CME FedWatch tool. However, till then, analysts said, gold prices may get support, as Fed Chair Kevin Warsh refrained from providing definitive forward guidance on future interest rate hikes.

 

"This is one of the important factors that might push gold prices higher," Rao said. "Earlier, one used to get some direction from the Fed as to where the interest rate might head. Now, it is the market that is predicting, and it is not based on the Fed meeting." The Arthavrksh founder does not feel that the Fed is in a hurry to raise interest rates, as crude oil-linked inflation worries are easing. At its July meeting, the Fed kept rates unchanged at 3.50-3.75%. Typically, interest rate cuts increase the appeal of non-interest-yielding gold. 

 

With crude oil prices retreating and inflation worries easing, analysts said gold prices are back to being driven by economic data over geopolitical developments. And data releases scheduled for August will kickstart that trend. To gauge the Fed's September monetary policy decision, analysts will track non-farm payrolls data for July, the consumer price inflation report, and other data releases. 

 

Following are the estimates from nine brokerages for gold prices in August, in alphabetical order of brokerage name:

 

Brokerage	COMEX support ($/oz)	COMEX resistance ($/oz)	MCX support (INR/10 gm)	MCX resistance (INR/10 gm)
Arthavrksh Financial Services	3,950	4,200	141,000	146,000
ICICI Securities	3,880	4,250	138,000	148,500
Kotak Securities	3,960	4,160	140,000	146,000
LKP Securities	3,900	4,125	137,000	141,000
Nirmal Bang	3,950	4,150	139,500	143,500
Prithvi Finmart	3,910	4,250	139,000	148,000
Quantace Research	3,950	4,300	140,000	151,000
SMC Global Securities	3,930	4,280	139,800	145,000
Ventura Securities	4,000	4,200	140,000	147,000
Median	3,950	4,200	139,800	146,000

 

End

 

US$1 = INR 95.11

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Rajeev Pai

 

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