Gold prices slipped further in Lucknow on Tuesday, tracking global declines amid renewed investor appetite for equities following progress in US-China trade discussions. Saumil Gandhi, Senior Analyst – Commodities at HDFC Securities, noted, “Gold resumed trading on a weaker note on Tuesday as signs of easing US-China trade tensions have increased investors’ interest in riskier assets, creating a negative impact on precious metals.”
Domestic Rates and Import Dependence
In Lucknow, 24-karat gold is priced at Rs 12,261 per gram, while 22-karat gold stands at Rs 11,235 per gram. The downward trend comes as improved global sentiment reduces safe-haven demand. India, being the second-largest gold consumer globally, relies substantially on imports to meet its domestic needs, with recycled gold contributing only modestly to total supply. Analysts suggest that while physical demand in northern cities like Lucknow often picks up during wedding and festive seasons, the current weakness in international markets has kept local demand relatively muted.
The rupee’s performance against the US dollar remains a crucial factor for price movements. A weaker rupee typically lifts gold prices by making imports costlier, whereas a stronger currency can ease retail prices. Over the past week, the rupee has remained range-bound, providing limited support to bullion. As global cues point to easing inflation and stable growth, investors are currently favouring equities and bonds over bullion.
Outlook Shaped by Global Economic Developments
Gold’s trajectory in international markets continues to be shaped by interest rate expectations, inflation trends, and central bank policy moves. The easing of trade tensions between major economies has dampened short-term demand for safe-haven assets like gold. Moreover, as yields on government bonds remain steady, non-yielding assets such as gold appear less attractive to investors seeking returns.
Despite near-term pressure, experts underline that gold’s long-term role as a store of value remains intact, particularly amid structural risks in the global economy. For Indian consumers, seasonal demand and festive buying may provide intermittent support to prices, even as broader global cues exert downward pressure. Local jewellers in Lucknow noted that customer footfall has slowed this week, but they expect improved sentiment ahead of Diwali, when gold buying traditionally surges. Analysts believe that the combination of a soft rupee and moderate global prices could make this period favourable for buyers seeking long-term value.
