Gold, Silver Prices Hit Record Levels on Global Cues, Geopolitical Tensions

Gold and silver prices reached new heights on the Multi Commodity Exchange (MCX) this Monday, driven by a bullish trend in the international market and escalating geopolitical tensions in the Middle East. Gold surged by Rs 637, marking an all-time high of Rs 71,080 per 10 grams. Similarly, silver witnessed a significant increase of Rs 1,381, setting a new record at Rs 82,109 per kg.

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In futures trading on the MCX, gold contracts for June delivery experienced a slight uptick of Rs 16 or 0.02 per cent, trading at Rs 70,652 per 10 grams. Silver contracts for May delivery also saw an increase, quoting higher by Rs 835 at Rs 81,698 per kg.

The upward movement in gold prices continued to reach Rs 70,900, buoyed by a surge in global Comex prices which hit USD 2,350 per ounce early in the morning, according to Jateen Trivedi, VP Research Analyst at LKP Securities. Despite a rise in US Treasury yields following robust March payroll data from the US—which altered expectations for Federal Reserve rate cuts in the latter half of this year—the rally in gold prices remains strong.

Internationally, gold futures soared to a lifetime high of USD 2,372.50 per ounce, while silver futures reached a three-year peak at USD 28.19 per ounce. The ongoing acquisition of gold by global central banks has significantly bolstered prices. This support is further amplified by sustained geopolitical tensions and the anticipation of forthcoming interest rate reversals.

Although the price outlook for gold remains optimistic, some correction towards Rs 69,500 is anticipated during this week, as noted by Trivedi. Praveen Singh – Associate VP at Sharekhan by BNP Paribas – highlighted that the encouraging US payroll data was predominantly driven by part-time jobs. He also mentioned that part of gold's gains could be linked to escalating tensions in the Middle East due to the potential for direct conflict between Israel and Iran, though no significant developments have occurred on that front yet.