Accordingly, the fears of supply shortages along with robust demand have kept prices higher. Besides, a sanction on Russia which is a major producer of Gold is expected to reduce supply.
Last week, MCX gold prices increased sharply by 4.66 per cent to Rs 52,559 levels. Besides, 'Spot Gold' prices increased by 4.30 per cent to $1,970.35 per ounce.
Notably, gold prices have increased by more than $40, accelerating a well-defined upward trend that began in the first week of March.
"Geopolitical tension, sanctions over Russia as well as sell off in equity markets and depreciation in currency will increase Gold demand," said IIFL Securities VP, Research, Anuj Gupta.
"We expect it to reach $2,000 in international market and Rs 54,000 on MCX in the short run."
According to Tapan Patel, Senior Analyst (Commodities), HDFC Securities: "Gold prices are hovering near the resistance levels of $1,970 per ounce reporting the biggest weekly gain in the last two years. The geopolitical risk premium over the Russia-Ukraine conflict and global inflation worries may continue to boost buying in gold despite the Fed policy change.
"The global supply shock in commodities may keep inflation levels high with crude oil trading above $100 per barrel. We may see spot COMEX gold prices nearing $2,050 per ounce in the short term while on the domestic front Rs 53,800 can be the resistance level."
In addition, Kshitij Purohit, Lead of Commodities and Currencies CapitalVia Global Research, said: "Gold's influence on the global economy has been amplified by the synergistic effect of both geopolitical instability and existing inflationary pressures. Gold prices have risen to their highest level since August 2020.
"For the week, gold was roughly 4 per cent higher. Support is seen near the 10-day moving average, which is around $1,918. Near the November 2020 highs of 1,965, resistance is seen."