On Friday, October 10, gold and silver prices experienced a modest increase, with gold futures priced at Rs 1,21,032 per 10 grams and silver at Rs 1,46,779 per kilogram. The recent gains come after a modest retreat in the prior session, influenced by global volatility and profit-taking, following bullion’s significant ascent to record highs earlier this week. Today’s gains have positioned both precious metals close to their all-time highs, bolstered by anticipations of U.S. interest rate reductions, purchases by central banks, and consistent demand for safe-haven assets.
In the international market, gold was priced at approximately $3,980 per ounce on Friday, on track for its eighth consecutive weekly increase following a record high earlier in the week. The rally was underpinned by global economic uncertainty and anticipations regarding U.S. interest rate reductions. New York Fed President John Williams indicated a willingness to consider another rate cut, although increasing inflation concerns may complicate the economic outlook. The sentiment was consistent with the recent FOMC meeting minutes, which underscored increasing risks to the labor market in conjunction with ongoing inflationary pressures, according to Reliance Securities.
Simultaneously, the current U.S. government shutdown, which has entered its second week, has postponed essential data releases, contributing to market ambiguity. On Thursday, gold retreated from its $4,000 milestone as the U.S. dollar gained strength and investors realized profits in light of reports regarding a ceasefire agreement between Israel and Hamas. On the MCX, December gold futures are anticipated to exhibit volatility within the Rs 1,19,900–1,20,500 per 10 grams range today. Strong central bank purchases and a movement among global investors towards safe-haven assets via ETFs are bolstering gold and silver prices.
Nonetheless, the minutes from the Federal Reserve meeting have heightened uncertainty regarding the prospect of aggressive rate cuts, while the dollar index has surged once more, constraining the potential gains for both precious metals. “The ongoing strength in gold is underpinned by apprehensions surrounding a potential U.S. government shutdown and the increasing trend of ‘de-dollarization,’ both of which are enhancing demand for safe-haven assets,” stated Jateen Trivedi. Analysts indicate that profit-taking and geopolitical clarity, particularly the ceasefire announcement between Israel and Hamas, may challenge the durability of the rally.