Gold prices touched an all-time high of ₹1,09,500 in Ahmedabad on the Multi Commodity Exchange (MCX) on Tuesday after opening at ₹1,08,947 per 10 grams. In international markets, gold futures are trading around $3,656 per troy ounce as of 15:00 IST. While silver prices hovering around time high of ₹1,25,463 per kg in Ahmedabad on the MCX.

Silver prices, too, extended their rally by climbing to a fresh 14-year peak above $42.35 in international markets. The surge came after weak U.S. employment data strengthened expectations of an aggressive Federal Reserve rate cut.

"The action builds on last week's surge as investors become more confident that the U.S. Federal Reserve would lower interest rates at its September monetary policy meeting—a move that markets now regard as almost certain after a run of poor job market data,” said Renisha Chainani, head of research at Augmont. 

Darshan Desai, CEO of Aspect Bullion & Refinery, echoed similar views. "The short-term sustainability of this rally will largely depend on the revised U.S. jobs data due later today, as well as upcoming inflation figures later this week. Continued ETF inflows, strong central bank purchases, and growing concerns over potential political pressure on the Fed are also likely to keep gold prices elevated,” he said. Globally, ETFs added 53 tonnes of gold in August, valued at approximately $5.5 billion. AUM of ETFs closed at a month-end high once more, and it is currently only 6% below the peak that was attained during the Covid pandemic. 

According to the Kotak Securities report, the gold and silver surge was supported by growing expectations of Fed rate cuts, with markets now expecting an overall 75-bp cut in the Fed rate by year-end. “Moreover, a weaker dollar, pressured by soft U.S. payroll data and concerns over Fed independence, added to bullion’s support,” it stated. 

Over the weekend, U.S. President Donald Trump signed an executive order exempting gold bullion, tungsten, uranium, and other metals from country-based tariffs.

Meanwhile, China’s central bank continued its buying streak, lifting gold reserves by 0.06 million troy ounces in August, its tenth consecutive month of accumulation. Traders will closely monitor this week’s U.S. inflation data, with the PPI expected to remain steady at 3.3% and the CPI expected to edge higher to 2.9% year-over-year.