The gold and silver prices surged to fresh highs in the domestic futures market on Monday, tracking firm global cues amid expectations of US Federal Reserve rate cuts and a weaker dollar.
On the Multi Commodity Exchange (MCX), the December gold contract climbed to a new peak of Rs 1,15,939 per 10 grams. The October gold contract also scaled a record of Rs 1,14,992 per 10 grams. Silver futures for December delivery jumped to an all-time high of Rs 1,44,179 per kg.
Analysts said the rise in bullion prices overseas was driven by growing bets of monetary easing by the US central bank.
"Gold prices have been shining for quite some time, and the past week saw gold prices touching new highs in the domestic as well as international markets," Prathamesh Mallya, DVP-Research, Non-Agri Commodities and Currencies at Angel One told PTI. He added that the rally showed no signs of cooling, with investors weighing whether to enter or book profits at elevated levels.
He pointed out that tariff measures, the Russia-Ukraine conflict, US-China trade tensions and other global factors have fuelled momentum in bullion in recent months.
Jigar Trivedi, Senior Research Analyst at Reliance Securities told PTI, traders are currently pricing in a 90 percent chance of a Fed rate cut in October and about a 65 percent probability of another move in December. He noted that uncertainty over a potential US government shutdown could also impact the central bank’s policy path.
Adding to the volatility, US President Donald Trump last week announced a fresh round of tariffs on imported drugs, trucks and furniture, effective October 1.
Market experts said expectations of monetary easing, coupled with geopolitical and trade-related risks, are likely to keep gold and silver prices elevated in the near term.
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