On September 30, gold prices reached new record levels due to strong physical demand, expectations of global rate cuts, and a resurgence in safe-haven buying amid political and economic uncertainty.
On the Multi Commodity Exchange (MCX), December Gold futures hit Rs. 1,17,460 per 10 grams for a fresh record high before retreating to trade at Rs. 1,17,375, or 0.90% higher intraday. Silver prices were also stronger with MCX Silver at Rs. 1,43,840 per kg, or 0.52% higher.
The rally in precious metals comes as investors turn to gold as a safety trade amid rising concerns of a potential US government shutdown, a weaker dollar, and expectations for further Federal rate cuts in the Federal Reserve in the near future.
In Mumbai, 24-carat gold prices climbed sharply. 1 gram of 24K gold was priced at Rs. 11,831, an increase of Rs. 142, while 10 grams cost Rs. 1,18,310, up by Rs. 1,420 from the previous day.
Similarly, the 22-carat segment also saw strong advances. 1 gram of 22K gold was priced at Rs. 10,845; Rs. 130 higher, while 10 grams were at Rs. 1,08,450, Rs. 1,300 higher.
The price of gold in Chennai also rose; however, the increase was modest compared to Mumbai. The price of 24K gold stood at Rs. 11,848 per gram, up by Rs. 99, and 10 grams priced at Rs. 1,18,480; a gain of Rs. 990.
For 22K in Chennai, one gram cost Rs. 10,860; Rs. 90 higher, and for 10 grams the price was Rs. 1,08,600; a gain of Rs. 900.
Globally, bullion markets reflected this trend, with international prices on track for their strongest monthly return in 14 years. A variety of factors, such as strong central bank buying, robust PMI data from China, and concerns about a potential partial government shutdown in the US, have fueled the rally.
Investors are betting further on monetary easing as CME’s FedWatch tool indicates a nearly 90% probability of a 25-basis-point cut at the next Fed meeting.
Analysts highlight that even though gold's technical charts appear overbought, it remains a safe-haven asset amid geopolitical and economic uncertainties. Resistance is near $3,800 per ounce, while continued momentum may take prices into the $3,900-$4,000 range.
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With gold touching new highs domestically, retail buyers face steeper costs, but investor sentiment continues to be buoyed by the prospect of further rate cuts and the ongoing flight to safety.