Gold showed strong performance during Friday’s intraday session, with February futures on the MCX trading higher at Rs 1,33,918 per 10 grams, reflecting an increase of over 1% or Rs 1,449. This upward movement follows a seven-and-a-half-week high, driven by the US Federal Reserve’s recent 25-basis-point rate cut. Gold’s rally is occurring against the backdrop of a weaker dollar index, ongoing fluctuations in global financial markets, and continued investor interest in precious metals following the Fed’s policy decision.
On Thursday, gold concluded the trading session with gains in both domestic and international markets. The February futures contract for gold ended at Rs 1,32,469 per 10 grams, reflecting an increase of 2.06%. Gold experienced notable upside momentum after the FOMC meeting results, with the U.S. Federal Reserve reducing interest rates by 25 basis points as widely anticipated. The metal climbed to levels not seen in seven weeks, buoyed by renewed optimism in the bullion market.
The dollar index declined to a two-month low following the FOMC outcome, helping bolster gold prices. Today, the U.S. Dollar Index was hovering near 98.38, inching up 0.03 or 0.03%. Strong fundamentals may continue to support gold prices.
“Weakness in the rupee is additionally supporting prices of precious metals in the domestic markets,” stated Manoj Kumar Jain. He noted that gold may maintain its critical support level of $4,040 per troy ounce in international markets. “We anticipate that gold prices will exhibit volatility during today’s session, influenced by fluctuations in the dollar index, instability in the global financial markets, and in anticipation of significant U.S. economic data,” he added.