Gold prices jump over 1% as lower crude oil prices ease inflation fears
Strong central bank buying, ETF inflows, and falling energy costs bolster investor confidence and point to a bullish outlook for bullion through 2026.
Gold prices jumped by over 1 per cent as falling global crude oil prices helped ease inflation worries, providing fresh momentum to commodity markets and reinforcing confidence among domestic and international investors. The retreat in energy costs has reduced fears of further aggressive monetary tightening abroad, creating a favourable backdrop for precious metals.
The rally comes on the back of sustained structural demand for bullion, led by central bank reserve accumulation and record inflows into gold exchange-traded funds (ETFs). Senior research analyst Amit Gupta of Kedia Advisory Services noted that central banks bought 321 tonnes of gold in the third quarter of 2026, marking a 42 per cent increase year-on-year. That brought cumulative central-bank purchases between January and September to 675 tonnes, a 6 per cent gain over the previous year, with China and Poland among the prominent buyers.
Global gold ETFs also experienced strong expansion, absorbing 211 tonnes in the third quarter to push total investor holdings to a record 4,256 tonnes. At the same time, global gold recycling dropped 8 per cent year-on-year to 314 tonnes during the quarter, tightening overall market supply.
In India, national macroeconomic stability and currency strength continue to anchor the commodity market. The Indian rupee has appreciated from around 97 to below 94 against the US dollar, reflecting steady foreign capital flows and robust domestic economic fundamentals. Analysts point out that while a stronger rupee can moderate domestic price spikes, solid investment demand on the Multi Commodity Exchange (MCX) ensures bullion remains an attractive long-term asset.
Market experts maintain a confident, bullish forecast for gold heading into the final stretch of 2026, supported by expectations of eventual monetary easing following the US Federal Reserve's decision to hold its target interest rate at 3.75–4.00 per cent in late October.
Gold price targets and market outlook for 2026
| Analyst / Firm | International target (per oz) | Domestic target (MCX) | Near-term support / bottom |
|---|---|---|---|
| Anindya Banerjee (Kotak Neo) | $4,400 – $4,450 | Rs 1,50,000 | Not disclosed |
| Dinesh Somani (ProIntellitrade) | $4,450 – $4,500 | Rs 1,49,000 | $3,860 / Rs 1,40,500 |
| Amit Gupta (Kedia Advisory) | $4,155 – $4,240 (resistance) | Not disclosed | $3,800 |
Gold has rebounded from its recent low of $3,869.85 recorded on 30 October 2026, after peaking at an all-time high of $5,594.82 on 29 January. Analysts advise existing investors to maintain their long-term strategic allocations while recommending staggered ETF purchases for new market entrants seeking stability and capital preservation.
Key numbers
| What | Figure | Source |
|---|---|---|
| Central bank Q3 gold purchases | 321 tonnes | Kedia Advisory Services |
| Total global ETF gold holdings | 4,256 tonnes | Kedia Advisory Services |
| US Federal Reserve target rate | 3.75-4.00 per cent | Federal Reserve policy decision of 28 October 2026 |
| Year-end MCX price forecast | Rs 1.50 lakh | Kotak Neo |
In this story
| Name | Role in the story |
|---|---|
| India | Domestic economic setting and commodity market context. |
