Gold prices today went up in Indian markets showing a firming global trend. On MCX, gold prices hit a new high, after August contracts surged 0.65% to ₹35,409 per 10 gram. Likewise, October gold contracts approached ₹36,000 mark when they surged over 0.7% to ₹35,965.
Tracking gold, silver prices also zoomed with September contracts on MCX rising over 1% to ₹41,218. In global markets, gold prices today hit a six-year high when rates surpassed the key $1,450 level – the first time since May 2013 – after comments from a top Federal Reserve official bolstered expectations of an interest rate cut.
Spot gold hit $1,452.60 an ounce before shedding easing to $1,442 while US gold futures jumped 1.1% to $1,444.10 an ounce.. So far this week, gold prices have gained nearly 2%.
Bets on a half percentage point rate cut from US Fed climbed after New York Fed President John Williams, at a central banking conference on Thursday, said policymakers need to add stimulus early to deal with lower inflation when interest rates are near zero and cannot wait for an economic disaster to unfold. Another top Fed official, Vice Chairman Richard Clarida, earlier had stressed the need to act quickly if the US economy looked likely to stumble.
Williams’ remarks sent the US dollar and bond yields lower, boosting the appeal of non-interest yielding assets like gold. Uncertainty in the Middle East also boosted gold’s safe-haven appeal. The US on Thursday said its Navy ship had “destroyed” an Iranian drone in the Strait of Hormuz after the aircraft threatened the vessel, but Iran said it had no information about losing a drone.
Reflecting investor optimism, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 1.42% to 814.62 tonnes on Thursday from 803.18 tonnes the previous day.
In global markets silver prices also showed a hardening trend, rising 0.5% to $16.42 per ounce, its highest since June 25, 2018. Silver has risen 8% so far this week, on track for its best week in three years.
Back in India, spot gold prices in Delhi market on Thursday rose by ₹170 to ₹35,670 per 10 gram while silver zoomed ₹910 to ₹41,100 per kg, according to the All India Sarafa Association.
Gold prices also got a boost after billionaire hedge-fund manager Ray Dalio advised buying the metal. In the past month, banks including Goldman Sachs Group Inc., Citigroup Inc. and Morgan Stanley have raised their forecasts for bullion amid slowing economies, lower interest rates and rising global tensions. Buying from global central banks has also supported the upmove in gold prices.