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Rising crude oil prices along with Covid-led supply chain disruptions as well as geo-political tensions and inflationary pressures are likely to lend support to gold, Motilal Oswal Financial Services said on Thursday.

According to MOFSL, gold prices are expected to move towards $2,000 per ounce (1 ounce is equivalent to around 31 gm) over the next 12-15 months.

Currently, gold futures are trading at around $1,840 per ounce in New York Mercantile Exchange, which is considered the global benchmark.

For the next quarter, gold prices are seen at $1,915 followed by $1,965. Support is pegged at around $1,800 and $1,745 zones, MOFSL said.

"Inflation has been one of the main highlights for 2021 and it could continue to be in the limelight next year too. The rising inflationary expectations were increasing the distress in the market for a long time, although the panic in the market started once US Governor Powell also acknowledged the same and started to act on it," it said.

Even if the major central banks take measures to calm inflation, rise in crude oil prices and continuing panic involving supply chain issues will continue to keep the pressure on inflation.

"And hence, gold prices have been holding firm even after the Fed's tapering announcement and three rate hike expectations. Market participants did surely discount the next year rate hike expectations although prices did recover from that fall," MOFSL said.

Investment in gold is widely considered to be the best hedge against inflation.

Having said that, a possibility of oversupply once the supply disruptions ease could impact the commodity market -- gold included.

Back in India, there are expectations of an import duty cut on gold in the Budget for FY23, to be tabled in the Parliament on February 1.

The Gem and Jewellery Export Promotion Council (GJEPC) had recently urged the Centre to reduce import duty on precious metals such as gold, silver and platinum from 7.5 per cent to 4 per cent.

The jewellery body also urged the Centre to cut import duty on cut and polished diamonds from 7.5 per cent to 2.5 per cent.