On the Multi Commodity Exchange, gold February futures commenced at Rs 1,41,731 per 10 grams, reflecting a decline of Rs 301 or 0.21%, following the previous day’s achievement of lifetime highs. Silver March futures, however, increased by Rs 399 or 0.15%, trading at Rs 2,69,369 per kilogram. The recent price movement follows a significant surge in bullion prices, which reached unprecedented heights on Monday. This increase was driven by safe-haven buying, prompted by U.S. President Donald Trump’s assertive approach towards Iran, highlighted by a 25% tariff warning directed at any nation engaging in trade with Tehran.
International gold prices experienced a decline on Tuesday following the metal’s achievement of an unprecedented high exceeding $4,600 per ounce the day before, as investors took the opportunity to realize profits in the context of persistent geopolitical and economic uncertainty. Spot gold experienced a decline of 0.4%, priced at $4,576.79 per ounce as of 0134, whereas U.S. gold futures for February delivery decreased by 0.6%, settling at $4,585.40. On Monday, bullion reached an unprecedented high of $4,629.94. Increased geopolitical tensions have been supporting the demand for safe-haven assets, particularly precious metals. On Monday, U.S. President Donald Trump declared a 25% tariff on any nation engaging in trade with Iran, as Washington evaluates its responses to the most significant anti-government protests in years within the country. The unrest in Iran occurs concurrently with other assertive actions in U.S. foreign policy, such as initiatives aimed at removing Venezuelan President Nicolas Maduro and discussions surrounding the potential acquisition of Greenland.
On Monday, domestic markets observed an uptick in both gold and silver futures. The February gold contract settled at Rs 1,42,032 per 10 grams, reflecting a gain of 2.31%, whereas the March silver contract concluded at Rs 2,68,970 per kilogram, marking a 6.43% increase. The notable increase was attributed to robust safe-haven purchasing, spurred by the intensifying conflict in Ukraine, turmoil in Iran, and overarching geopolitical instability, according to analysts. Manoj Kumar Jain highlighted the increasing optimism regarding potential rate cuts by the U.S. Federal Reserve as a contributing factor bolstering precious metals. “Portfolio diversification and ETF buying have propelled both gold and silver to unprecedented levels,” he noted. Gold prices have settled above $4,600 per troy ounce, while silver has exceeded $85 per troy ounce, indicating significant resilience in the market.
Jain noted that volatility persists in both markets, yet indicated that critical support levels may withstand pressure. He anticipates that silver will sustain support levels close to $70 per troy ounce, while gold is projected to hover around $4,380 per troy ounce on a closing basis. The dollar index has been trading near one-month highs, even as the U.S. dollar maintained its recent losses. The currency remained near the 98.96 mark, reflecting an increase of approximately 0.10%, following the initiation of a criminal investigation by the Trump administration into Federal Reserve Chair Jerome Powell. This development has sparked concerns regarding the independence of the central bank and the overall confidence in U.S. assets.