Geopolitics - US-Iran tensions and local demonstrations in Iran are enhancing gold's appeal as a safe-haven asset [2] - President Trump's threats to acquire Greenland and impose tariffs are contributing to market instability and increasing gold prices [4][6] Tariffs - Trump has threatened a 25% additional tariff on countries trading with Iran and a 10% tariff on European nations opposing his Greenland acquisition [6] - Europe is considering retaliation on over $100 billion worth of US goods, raising fears of a trade war and boosting safe-haven demand [7] Demand and Supply - Total gold demand grew 3% year-on-year to 1,313 tonnes in Q3, the highest quarterly total recorded, with a 44% increase in value to $146 billion [9] - Year-to-date demand is up 1% at 3,717 tonnes, equating to $384 billion, a 41% year-on-year increase [9] - Heavy ETF buying of 222 tonnes and bar and coin demand of 316 tonnes contributed to the overall demand rise [10] - Jewellery consumption declined for the sixth consecutive quarter to 371 tonnes, while value increased by 13% year-on-year to $41 billion [10] Central Bank Buying - Central bank purchases remained high at 220 tonnes, a 28% increase from the previous quarter, although year-to-date buying is slower compared to last year [11] De-dollarisation - The US dollar's share in global exports and output is declining, with its dominance in transactional areas still evident [12] Rupee - Domestic gold prices are supported by the weakening Indian rupee, which has depreciated significantly since the start of 2026 [13] - USDINR January futures are trading above 91, indicating a depreciation of over one rupee this year, benefiting local participants from rising global gold prices and rupee depreciation [13]
Explained! Gold smashes Rs 1.5 lakh mark for first time, ever: 6 reasons why it appears unstoppable
The Economic Times·2026-01-20 11:05