Geo-political uncertainties, sustained central bank buying and a weak rupee against the dollar are likely to push the prices of gold up to Rs 42,000 per 10 gram by the end this year, according to analysts.

“Geo-political uncertainties emerging from West Asia may continue to underpin gold prices going ahead to $1,650 an ounce in Comex markets and Rs 42,000 in MCX,” Commtrendz Research co-founder and CEO Gnansekar Thiagarajan said.

The yellow metal is likely to continue to remain bullish till the end of the year mostly because of sustained Central bank buying, geo-political uncertainties and possible year-end squaring of positions in equities boosting appeal for safe-haven gold, he said.

Gold prices were at Rs 38,302 per 10 gram in MCX, while it was at $1,506 in Comex.

The year so far has proved to be one of the best for gold returns as prices have risen by 15 per cent on the domestic front, getting some support from weakness in the rupee, which has fallen 1.4 per cent against the dollar, said Navneet Damani, Motilal Oswal Financial Services (MOFSL) VP — commodity research.

“We expect positive momentum for gold to continue further, but the pace of the rally could get measured as uncertainties related to the trade war are taking a back seat. This slowdown in major economies could push central banks to remain dovish for an extended period and that will support gold prices,” he said.

The ease off in trade war could lead to some correction in prices. However, the prices will remain bullish and are expected to move higher to test the previous highs of Rs 39,500 by the end of the year, he said.

“Going forward, gold is expected to average in a broad range of $1,460-1,530 in dollar terms and between Rs 36,800-39,400 in rupee terms on MCX,” said Ravindra Rao, Kotak Securities head of commodities.

Investment demand, which is an indicator of the safe haven buying in the yellow metal, has surged in the third quarter, he said.

The optimism about US-China trade talks and a Brexit deal has prompted traders to book some profits but gold remained bullish as the ongoing trade concerns have already impacted the global economy as seen from the International Monetary Fund projections, he added.

According to the IMF, the global economy is projected to grow at 3.5 per cent in 2019 and 3.6 per cent in 2020.