Gold prices soared Rs 500 on Thursday, reaching a two-month high of Rs 81,300 per 10 grams in Delhi’s bullion market. The rally was driven by fresh buying from jewellers and retailers, alongside a weakened rupee, according to the All India Sarafa Association. On Wednesday, the metal had closed at Rs 80,800 per 10 grams.
Meanwhile, gold of 99.5% purity also jumped Rs 500, settling at Rs 80,900 per 10 grams from its previous close of Rs 80,400.
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Silver joined the rally, spiking Rs 2,300 to Rs 94,000 per kilogram, compared to Wednesday’s Rs 91,700.
Futures market signals uptrend
Gold contracts for February delivery on the Multi Commodity Exchange (MCX) rose Rs 297, or 0.38%, to Rs 79,007 per 10 grams. Silver contracts for March delivery also appreciated Rs 654, or 0.7%, reaching Rs 93,510 per kilogram.
Jateen Trivedi, VP Research Analyst of Commodity and Currency at LKP Securities, attributed the rally to the rupee’s depreciation and global market trends. “Gold trading above Rs 79,000 on MCX reflects the weakening rupee and the supportive international sentiment following the US CPI data,” Trivedi noted.
The rupee slid 16 paise to close at 86.56 against the US dollar on Thursday, weighed down by a strong greenback, high crude oil prices, and persistent foreign fund outflows.
Global drivers of the surge
Globally, Comex gold futures climbed $19.70 per ounce, or 0.72%, to $2,737.50 per ounce. Analysts linked the rally to softer-than-expected US core CPI data, which boosted hopes for further Federal Reserve rate cuts. “The inflation reading has bolstered gold’s momentum, as market expectations lean towards continued rate cuts,” Trivedi added.
Comex silver futures also gained 1.28%, trading at $31.94 per ounce during Asian market hours.
Outlook: Optimism prevails
Renisha Chainani, Head of Research at Augmont, painted a bullish picture for gold. “Factors such as potential economic policies under the future Trump administration—like tax cuts and higher tariffs—could stoke inflation and drive gold prices higher,” she explained.
HDFC Securities’ Saumil Gandhi emphasized that upcoming US macroeconomic data, including retail sales and the Philadelphia Fed Manufacturing Index, will provide further direction for bullion prices.
As inflationary pressures build and rate cuts loom, gold appears to be regaining its status as a safe haven, while silver’s parallel surge hints at broader optimism in the bullion market.
