Gold hits ₹1.5 lakh/10gm, silver surges 3% on Fed rate cut expectations

Gold futures opened higher on MCX with the benchmark October gold contract opening at ₹1,49,355 per 10 gram, up ₹497 from the previous close of ₹1,48,858, according to Business Standard. At the time of writing, the contract was trading at ₹1,49,457, up ₹599, having touched a high of ₹1,49,554 and a low of ₹1,49,164. Gold futures had touched their highest level of the year at ₹1,80,779 during the session. In global markets, gold was trading near $4,320 per ounce on Comex, while US gold futures gained 0.5% to $4,321.50 and spot gold price rose 0.6% to $4,262.39 per ounce. The rally was supported by easing geopolitical tensions and falling oil prices that eased expectations of further Federal Reserve tightening. On Friday, gold futures for October delivery rose ₹1,272, or 0.85%, to ₹1.50 lakh per 10 grams on MCX, with trading volumes at 1,283 lots, as reported by CNBC TV18. Globally, gold futures rose 1.13% to $4,287.50 an ounce in New York, with gold having gained sharply over the week from around $4,090 an ounce on August 3 to around $4,350 on August 7, according to Quantace Research.

Silver futures opened on a strong note with the benchmark September silver contract on MCX opening at ₹2,27,993 per kg, up ₹2,157 from the previous close of ₹2,25,836, according to Business Standard. At the time of writing, the contract was trading at ₹2,28,000, up ₹2,164, having touched a high of ₹2,28,095 and a low of ₹2,27,481. Silver futures had touched their highest level of the year at ₹4,20,048 per kg. In global markets, silver was trading around $62.50 per ounce on Comex, while Comex silver futures opened at $61.85 per ounce and were trading at $62.47 per ounce, up $0.86. Spot silver price rallied 1.3% to $62.27 per ounce. Vanadana Bharti, Head of Commodity Research at SMC Global Securities, noted that the silver price's recent strength is being supported by a tightening physical market, as major global inventories remain under pressure, while industrial demand continues to absorb large quantities of silver. On Friday, MCX silver futures for September delivery gained ₹5,496, or 2.43%, to ₹2.31 lakh per kg, with 2,943 lots changing hands, as reported by CNBC TV18. In the international market, silver futures rose 3.44% to $61.66 an ounce, with silver moving to multi-week highs. Silver's sharper move on Friday compared with gold reflects the higher volatility typically associated with the white metal.

Gold prices gained momentum following the release of US job openings data on Tuesday, which showed positions declined in the previous month, according to GoodReturns.in. However, given the improvement in hiring and the low layoff rate, the labour market remained steady. Market participants are now awaiting the ADP employment report due to be released later in the day, which could provide further cues on the Federal Reserve's next interest rate move. The data release has influenced gold's direction in the short term, with traders factoring in a 57% probability of a rate hike by the US Federal Reserve at its September meeting. NDTV Profit reports that traders currently see a 55% chance of a US Fed rate hike in September, from 63% a week ago, per the CME FedWatch Tool. Investors are also watching US economic data for clues on the Federal Reserve's next policy move, with a weaker labour market could strengthen expectations of lower interest rates, which would generally be supportive for gold, as noted by VT Markets. The next major trigger for global precious metals could be the US non-farm payrolls report, with a softer jobs reading could reinforce expectations of monetary easing, while stronger-than-expected data could push yields and the dollar higher and weigh on gold.

Easing concerns over inflation and a higher-for-longer interest rate outlook continue to buoy investor sentiment, as reported by GoodReturns.in. Market participants will closely monitor upcoming US economic data this week, including the ADP employment report and other key indicators. The combination of geopolitical stability, supportive monetary policy expectations, and strong international bullion market performance continues to support gold's current price levels in the domestic market, with the metal trading significantly higher across all purity levels. CNBC TV18 reports that the recent rally in precious metals has been supported by a combination of lower US Treasury yields, expectations of easing inflation pressures, a softer dollar and continued demand for precious metals. Gold typically benefits when bond yields fall because the opportunity cost of holding a non-yielding asset such as gold declines, while a weaker dollar can also make dollar-denominated gold cheaper for buyers holding other currencies. Justin Khoo from VT Markets said gold's recent rally was driven by a combination of falling oil prices, weaker US labour market data, lower Treasury yields and changes in geopolitical risk, rather than safe-haven demand alone. For Indian investors, international gold prices are only one part of the equation, with the rupee-dollar exchange rate, import-related costs and domestic demand also influencing local gold prices. With the rupee around ₹95.22 against the US dollar, currency movements can amplify or offset changes in international bullion prices. Karthick Jonagadla from Quantace Research said the $4,300 level is an important test for gold, with a sustained move above it could keep the metal in the $4,350-$4,400 range, while a fall below $4,200 could indicate profit-taking.