Trump's loss in US midterms hands Indian gold buyers new setup before Dhanteras

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The Economic Times daily newspaper is available online now. Read Today's Paper Trump's loss in US midterms hands Indian gold buyers new setup before DhanterasBy Rakshanda Sharma, ET OnlineLast Updated: Nov 04, 2026, 03:09:00 PM ISTSynopsis

Gold prices surged over 2% on Wednesday, with a weaker US dollar and lower Treasury yields supporting the rally after Democrats made gains in the US midterm elections. In India, 24-karat gold rose 2.26% to ₹14,280 per gram.

Gold prices jumped more than 2% on Wednesday as a weaker US dollar and falling Treasury yields lifted demand for the precious metal after Democrats made gains in the US midterm elections.

In India, 24-karat gold was trading at ₹14,280 per gram, up from ₹13,964 on Tuesday, a rise of 2.26%.

The rally comes just days before Dhanteras, when gold purchases are traditionally expected to pick up across the country. While higher prices could weigh on affordability, jewellers expect demand to remain firm, with the US election outcome adding to positive sentiment around gold.

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Gold sales volume this Dhanteras could rise by as much as 12% year-on-year, as demand has held up over the past 7-10 days and buyers may bring forward purchases despite rising prices, Surendra Mehta, national secretary of the India Bullion & Jewellers Association (IBJA), told ET Online.

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IBJA has raised its sales growth estimate to as much as 12% from its earlier projection of 7-10% following the US election results.

Ripple effects of Iran war

Mehta said the election outcome could limit US President Donald Trump's room for manoeuvre on the war front, potentially bringing down oil prices and easing pressure on the global economy.

ALSO READ | US midterm election results 2026: India sees some trade relief, new risks after US midterm vote

Trump acknowledged that the war in Iran had contributed to Republican losses in Tuesday's midterm elections. Democrats were preparing to take control of both the US House and Senate, potentially placing greater checks on his legislative agenda.

The election outcome has also shaped expectations in financial markets. A weaker dollar and lower US Treasury yields have provided immediate support to gold, said Nitin Kedia, national general secretary of the All India Jewellers & Goldsmith Federation (AIJGF).

“In my view, the mandate sends a strong message that American voters are unhappy with the Iran war and the pressure of rising living costs. It also raises expectations of greater checks on policies that have contributed to economic uncertainty.”

However, the political shift could also have implications for other precious metals. Stronger Democratic influence may bring greater scrutiny of AI and data-centre expansion, particularly over electricity costs, resource consumption and regulatory safeguards, Kedia said.

“Any slowdown in investment could create market volatility and temper expectations for silver’s industrial demand. This is a policy risk to watch, rather than a certainty.”

For gold, any easing of geopolitical tensions could also erode some of its safe-haven premium, he said.

Rupee movement

For Indian buyers, the domestic price trajectory will depend not just on international gold prices but also on the rupee's movement against the dollar. A weaker rupee could offset some of the gains in global prices, keeping local rates elevated and putting pressure on affordability, Kedia said.

The initial reaction to the US election results has been a weaker dollar and lower Treasury yields, both of which have supported international gold prices. However, the extent to which this translates into lower or higher retail prices in India will depend on the rupee-dollar exchange rate, import costs and domestic market conditions, said Manoj Ravi, CEO of Supra Pacific Financial Services Ltd.
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