Gold and silver futures climb on safe-haven demand amid US-China trade tensions. Market analysis and expert insights included.
On the Multi Commodity Exchange (MCX), the yellow metal futures for December delivery appreciated by Rs 483, or 0.4 per cent, to Rs 1,21,715 per 10 grams in a business turnover of 13,230 lots. In the previous week, gold had dropped by Rs 2,219, or 1.8 per cent on the exchange.
Silver futures for December delivery jumped by Rs 909, or 0.61 per cent, to Rs 1,49,196 per kilogram in 19,935 lots.
The white metal snapped a nearly two-week losing streak, rising Rs 817, or 0.55 per cent, during the past week.
An expert said, “Remarks by US President Donald Trump indicating that his administration could curb exports of advanced AI technology to China lent some support to the bullion prices.”
In the international markets, Comex gold futures for December delivery rose 0.27 per cent to USD 4,007.45 per ounce while silver went up by 0.66 per cent to USD 48.48 an ounce.
“Gold prices are consolidating around USD 4,000 and silver around USD 48 an ounce, as expectations for further US rate cuts diminished and safe-haven demand eased following a US-China trade deal,” Renisha Chainani, Head – Research at Augmont, said.
She added that despite the US Federal Reserve’s widely anticipated rate cut last week, Chair Jerome Powell hinted that it might be the last one this year, citing the lack of economic data due to the prolonged government shutdown.
Last week, Trump and Chinese President Xi Jinping reached an agreement to prevent their trade dispute from escalating further. Under the deal, Washington agreed to reduce tariffs, while Beijing pledged to lift restrictions on rare earth exports and increased its purchases of American soy beans.
“The price of gold may decline if the US-China trade agreement has positive effects on the market for safe-haven assets. Gold’s recent strong drop has not affected its long-term favourable fundamental drivers.
“However, China’s decision to eliminate the 6 per cent VAT incentive on gold sales could raise consumer prices and temper the safe-haven demand in one of the world’s largest bullion markets,” Chainani said.
In its latest Gold Demand Trends report, the World Gold Council (WGC) said investor demand continued to dominate in the third quarter.
Global gold demand increased as massive exchange traded fund (ETF) inflows stood over 222 tonnes, while bar and coin demand posted its fourth consecutive quarter exceeding 300 tonnes, as per the industry body WGC.
Meanwhile, the lengthy US government shutdown has delayed several key economic releases, including monthly jobs data, creating uncertainty in markets.
“This week, investors will look for cues from private indicators such as the Michigan consumer sentiment index, ISM PMIs, and the ADP employment report,” Chainani added.