Gold prices continued their upward trajectory, reaching a new peak of Rs 1,27,500 per 10 grams during early trading on Wednesday. This increase is attributed to a surge in safe-haven demand, driven by escalating geopolitical tensions and anticipations of a potential rate cut by the US. The yellow metal was recently observed trading at Rs 1,26,798, reflecting an increase of Rs 542 or 0.43% from the prior closing value. Silver prices reflected the strength in bullion, increasing by Rs 1,090 or 0.68% to Rs 1,60,594 per kilogram. This movement was influenced by a mix of safe-haven flows, industrial demand prospects, and the persistent trade tensions between the US and China.
On the international stage, gold prices experienced an uptick on Wednesday, remaining close to record highs. This movement can be attributed to a surge in investor interest in safe-haven bullion, prompted by escalating U.S.-China trade tensions that have intensified global uncertainty. Additionally, the anticipation of further U.S. interest rate cuts has contributed to this upward momentum. Spot gold increased by 0.4% to $4,155.99 per ounce. U.S. gold futures for December delivery increased by 0.3%, reaching a price of $4,174.30. Bullion, devoid of interest yield and regarded as a safe-haven asset amid wider uncertainties, has appreciated by 55% year-to-date, reaching a historic peak of $4,179.48 on Tuesday. On Tuesday, gold and silver concluded on a favorable note in both the domestic and international markets. The December futures contract for gold concluded at Rs 1,26,256 per 10 grams, reflecting an increase of 1.31%. Meanwhile, the December futures contract for silver settled at Rs 1,59,504 per kilogram, marking a rise of 3.14%.
Gold and silver continued to rise during a session marked by significant volatility following the remarks of the U.S. Fed Chairman. The U.S. Fed Chairman indicated that there has been minimal progress in the U.S. job market and inflation since the September policy meeting; however, U.S. growth may surpass expectations. He expressed his concerns regarding the ongoing U.S. shutdown. Powell indicated that interest rate decisions would be approached on a “meeting-by-meeting” basis, weighing the softness in the labor market against the ongoing inflation that remains above the target level. Market participants are anticipating a 25-basis-point reduction in interest rates at the forthcoming Federal Reserve meeting this month, with expectations of a comparable decrease in December. Following his remarks, markets rebounded from the day’s low and sustained their upward trajectory.
Global uncertainty and safe-haven buying are contributing to the support of both precious metals. We anticipate fluctuations in gold and silver prices this week, influenced by the instability of the dollar index, the turbulence in global financial markets, and the ongoing US-China trade conflict. Gold prices are anticipated to fluctuate between $3,910 and $4,240 per troy ounce, while silver is projected to range from $47.70 to $53.50 per troy ounce this week, according to Manoj Kumar Jain. Today, the US Dollar Index was hovering near the 98.85 mark, falling 0.19 or 0.20%.