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Gold prices moved higher in early trade on Wednesday, fueled by safe-haven demand amid escalating tensions in the Middle East and expectations of a US Federal Reserve rate cut.
On the Multi Commodity Exchange (MCX), gold futures opened flat at Rs. 1,19,467 per 10 grams, slightly above the previous close of Rs. 1,19,646. Prices climbed by Rs. 401, or 0.34%, to Rs. 1,20,047 per 10 grams by 9:15 AM. Silver futures also edged higher by Rs. 989, or 0.69%, to Rs. 1,45,331 per kilogram.
Gold has surged nearly 52% so far this year, reaching an all-time high of $4,381.21 per ounce in October, supported by central bank purchases and global instability.
According to Jigar Trivedi of Reliance Securities, MCX gold prices are likely to test Rs. 1,20,500 in the near term, with Rs. 1,19,000 acting as strong support.
In Mumbai, gold prices edged slightly higher. The price of 24-carat gold rose to Rs. 12,158 per gram from Rs. 12,082 a day earlier, while 10 grams traded at Rs. 1,21,580 compared to Rs. 1,20,820 yesterday.
Similarly, 22-carat gold rose to Rs. 11,1455 per gram from Rs. 11,075, with the 10-gram price gaining to Rs. 1,11,450 from Rs. 1,10,750.
In Chennai, gold prices also increased. The price of 24-carat gold rose to Rs. 12,229 per gram from Rs. 12,082 the previous day, while 10 grams reached Rs. 1,22,290 from Rs. 1,20,820.
22-carat gold also increased to Rs. 11,210 per gram from Rs. 11,075, and for 10 grams the price rose to Rs. 1,12,100 to Rs. 1,10,750.
In Delhi, the prices mirrored those of Mumbai.
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Spot gold rose 0.2% to $3,957.42 per ounce, while US gold futures slipped slightly by 0.3% to $3,971.20 per ounce. Market participants expect the Fed to announce a 25-basis-point rate cut, while closely watching Fed Chair Jerome Powell’s comments for clues on future monetary policy.
Although US-China trade tensions have relaxed, geopolitical risks such as renewed conflict between Israel and Hamas have contributed to keeping gold's appeal as a safe-haven.
Experts expect gold to remain volatile, but it will be supported by the Fed’s decision on a rate cut. A dovish policy stance could lift gold, while the easing geopolitical tensions might limit short-term gains.
