3 weeks ago
Gold, Silver Rally Likely to Extend on Inflation Data, Tensions
Gold and silver are shiny metals that people like to buy.
Last week, they became more expensive.
In India, the price of gold went up by almost six percent.
Silver went up by about seven percent.
Prices also jumped in other countries around the world.
A big reason is that America's job market grew more slowly than people expected.
That makes people think the Federal Reserve, America's central bank, will make borrowing cheaper.
When that happens, people often like to buy gold and silver to keep their money safe.
People are also worried about tensions in West Asia.
Next week, everyone will watch new inflation reports and other news to see if prices keep going up.
Gold and silver prices posted strong gains last week, with October gold futures on the Multi Commodity Exchange closing at ₹1.51 lakh per 10 grams, up nearly 6%.
Silver futures for September delivery jumped nearly 7% to settle at ₹2.31 lakh per kg on the Multi Commodity Exchange.
Internationally, December gold futures surged 7% to $4,399.7 an ounce, while September silver climbed nearly 10% to $63.50 an ounce.
Analysts expect gains to extend as investors track inflation data from the US, Germany, Japan and India, along with Chinese economic data and Federal Reserve policy expectations.
West Asia tensions, particularly developments involving the US and Iran, remain a key trigger and could cause sharp price movements when trading resumes.
- Who
- Investors and analysts tracking precious metals, including Pranav Mer of JM Financial Services and Jateen Trivedi of LKP Securities
- What
- Gold and silver prices rallied sharply last week and are expected to extend their gains next week
- Where
- India's Multi Commodity Exchange in New Delhi and international bullion markets
- When
- The rally took place during the past week; the outlook covers the coming week
- Why
- Weaker-than-expected US labour market data, a softer dollar, expectations of easier Federal Reserve policy and West Asia tensions
Key facts
- Gold futures (Oct, MCX)
- ₹1.51 lakh per 10 grams, up ₹8,444 (nearly 6%)
- Silver futures (Sep, MCX)
- ₹2.31 lakh per kg, up ₹14,268 (nearly 7%)
- International gold (Dec futures)
- $4,399.7 per ounce, up $292.7 (7%)
- International silver (Sep futures)
- $63.50 per ounce, up $5.71 (nearly 10%)
- Short-term targets (JM Financial)
- Gold ₹1.57 lakh per 10 grams; silver ₹2.80 lakh per kg
- Data to watch
- Inflation figures from US, Germany, Japan and India; Chinese economic data, especially for silver
- Key risk
- West Asia developments involving the US and Iran
Quotes
Jateen Trivedi
VP Research Analyst, Commodity and Currency, LKP Securities
“Gold witnessed a strong rally this week, gaining nearly 6 per cent, as weaker-than-expected US labour market data revived expectations of a more accommodative monetary policy from the Federal Reserve”
thehansindia.com
“Gold and silver momentum looks positive and are expected to trade with a positive bias and move up towards Rs 1.57 lakh per 10 grams and Rs 2.80 lakh per kg in the short term”
thehansindia.com
Sources
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