Gold futures on the Multi-Commodity Exchange reached a new all-time high on Wednesday, climbing to Rs 1,22,101 per 10 grams for the contract expiring on 5th December 2025. The significant increase, rising by Rs 819 or 0.68% for the day, highlights the robust demand from investors for safe-haven assets in the context of escalating global uncertainties and anticipations of monetary easing. Silver futures also participated in the rally, increasing by Rs 1,221 to reach Rs 1,47,013 per kg. Gold surged past $4,000 an ounce on Wednesday, reaching a record high as investors flocked to the asset amid escalating economic and geopolitical uncertainties, coupled with anticipations of additional interest rate reductions by the U.S. Federal Reserve.
Spot gold increased by 0.3% to $3,997.09 per ounce as of 0202, following its peak at an unprecedented $4,000.96. U.S. gold futures for December delivery increased by 0.4%, reaching $4,020.00 per ounce. Historically, gold has been regarded as a reliable store of value in periods of instability. Spot gold has experienced a 52% increase year-to-date, following a 27% rise in 2024. A combination of elements, including increased acquisitions by central banks, a resurgence in interest for gold-backed exchange-traded funds, a weakening U.S. dollar, and robust retail demand, has driven the metal’s upward trajectory. It is posited by analysts that a “fear of missing out” is contributing to the ongoing rally in gold. On Tuesday, gold and silver concluded the trading session with a mixed performance in both domestic and international markets.
The December futures contract for gold concluded at Rs 1,21,111 per 10 grams, reflecting an increase of 0.72%. In contrast, the December futures contract for silver settled at Rs 1,45,792 per kilogram, showing a decline of 1.17%. On Tuesday, gold prices surpassed the $4,000 threshold for the first time. Gold and silver exhibited significant price volatility, ultimately concluding on a mixed note in the context of a rebound in the dollar index and in anticipation of the forthcoming Fed meeting minutes. The dollar index reached a three-week peak in anticipation of the Federal Reserve meeting minutes, prompting profit-taking in the precious metals market. Today, the US Dollar Index was hovering near the 98.87 mark, gaining 0.29 or 0.29%.
“However, political turmoil in France, economic worries in Japan and Argentina, the U.S. shutdown and escalation in the Russia-Ukraine war are supporting safe-haven buying for precious metals,” stated Manoj Kumar Jain. In September, the People’s Bank of China continued its trend of gold purchases for the 11th consecutive month, while other central banks are similarly amassing gold as a strategy to safeguard their currencies and bolster the prices of precious metals.