Quote on Gold by Satish Dondapati, Fund Manager, Kotak Mutual Fund
Quote on Gold by Satish Dondapati, Fund Manager, Kotak Mutual Fund
“Gold prices have corrected nearly 3% in USD terms over the past week, touching their lowest level in almost a year. While softer US bond yields and a weaker dollar should support gold prices, the Fed’s hawkish stance and expectations of interest rates staying higher for longer have kept prices under pressure. At the same time, the ongoing Iran conflict continues to disrupt global energy markets, keeping crude oil prices elevated and adding to inflation concerns.
Despite geopolitical tensions and inflationary risks, gold has failed to gain support as markets remain focused on the Fed’s interest rate outlook. However, the recent correction does not change the long-term investment case for gold, particularly as high interest rates may not be sustainable for an extended period.
Gold may remain under pressure in the near term, with further volatility possible. Investors should avoid investing the entire amount at current levels and instead consider staggered buying on declines. Gold can continue to form part of a long-term portfolio as a hedge against uncertainty and for diversification.”
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