Gold’s remarkable rally continued on Friday egged by US President Donald Trump’s Thursday remark that he will apply pressure on the Federal Reserve to bring down interest rates. On Friday, the MCXgold futures hit a fresh lifetime high of Rs 80,312 per 10 gram while breaching the Rs 83,000 mark in the spot markets.
The difference in futures’ prices and spot prices are due to a 3% GST on physical gold along with the premium it commands.
Anuj Gupta, Head – Commodity & Currency at HDFC Securities said that Trump’s utterances in the World Economic Forum in Davos has triggered the rally in the yellow metal. He confirmed gold surpassing the Rs 83,000 mark on Friday.
Earlier, PTI had reported gold of 99.9% purity touching the levels of Rs 83,100 per 10 grams in the physical markets quoting All India Sarafa Association.
Trump’s remark caused a slip in the dollar index (DXY) which was trading at 107.69 against a basket of six top currencies, down by 0.36 points or 0.33%.
Movement of greenback is inversely related to the prospects of bullion.With today’s gains, gold has extended its rally for the eighth consecutive session, the PTI report said.So far, in January, MCX gold futures have appreciated by 4.5% or Rs 3,448, Gupta said.
Meanwhile, the March silver futures were trading at Rs 91,870 per kg, gaining by Rs 721 or 0.79%.
“Gold extended gains on Friday, with spot gold in the domestic market hitting fresh all-time highs,” Saumil Gandhi, Senior Analyst of Commodities at HDFC Securities, said.
The current bullish momentum in gold is driven by uncertainty surrounding the potential US tariffs plan and other policies from President Donald Trump, which has led to a recent surge in safe-haven buying, Gandhi added.
“Prices in MCX are near record high as Trump trade policies and tariff plans created an uncertain environment in the market, which may boost safe-haven demand,” Deveya Gaglani, Research Analyst-Commodities, Axis Securities, said.
The precious metal on the futures index had hit a record high of Rs 80,282 per 10 grams on October 30, 2024.
In the international markets, Comex gold futures appreciated by $15.50 per ounce or 0.56% to $2,780.50 per ounce.
Investors are expected to keep an eye on flash PMIs for early indications of economic activity in major global economies, as well as US housing data for further insights into the state of the economy, Kaynat Chainwala, AVP-Commodity Research, Kotak Securities, said.
Investors are expected to keep an eye on flash PMIs for early indications of economic activity in major global economies, as well as US housing data for further insights into the state of the economy, Kaynat Chainwala, AVP-Commodity Research, Kotak Securities, said.
Comex silver futures also increased 1.53% to $31.32 per ounce in the Asian market hours.
According to Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities, investors will also look ahead for the upcoming Union Budget and the US Federal Reserve’s interest rate decision, which are the key events on the radar for the future course of action for the bullion prices.
Gold trading strategy
Gupta remains bullish on the prospects of gold and recommends a buy around Rs 75,500-75,700. He places a stop loss at Rs 71,500 while the price target at Rs 85,300-87,000 by Dhanteras this year.
(Inputs from PTI)