Gold prices increased by more than one percent, reaching a new peak on Tuesday, October 14. Gold futures were priced at Rs 1,26,299 per 10 grams. The increase was propelled by a resurgence in safe-haven demand in light of renewed U.S.-China trade tensions, alongside broader economic and political uncertainties, as well as expectations of additional U.S. interest rate reductions, which provided further support. Today’s gains have propelled both precious metals to their all-time highs, bolstered by anticipations of U.S. interest rate reductions, consistent purchases by central banks, and ongoing demand for safe-haven assets in the face of global economic uncertainties.
In the international market, the yellow metal surpassed the $4,100 per ounce threshold for the first time, establishing a new record in the context of escalating U.S.-China trade tensions and increasing anticipations of U.S. interest rate reductions. Silver reached an unprecedented peak, following the upward trend observed in gold. Spot gold increased by 2.2% to $4,106.48 per ounce after reaching an intraday high of $4,116.77, while U.S. gold futures for December concluded 3.3% higher at $4,133. The metal has appreciated approximately 56% year-to-date, having surpassed the $4,000 threshold just last week.
Meanwhile, spot silver advanced 3.1% to $51.82, following a peak of $52.12. The support stemmed from similar factors and the tight conditions prevailing in the spot market. Moreover, the current U.S. government shutdown, which has now extended into its third week, has resulted in the postponement of critical economic data releases, thereby heightening investor caution and contributing to market volatility.
“The U.S. administration’s announcement of a 100% tariff hike on select Chinese products, coupled with China’s threat to restrict rare earth exports, has heightened global uncertainty and risk aversion.” This geopolitical tension, coupled with persistent demand from investors seeking safety, maintains a bullish outlook for gold, according to Jateen Trivedi.