Bullion rally continues: Gold reaches new peak of ₹1.17 lakh on MCX; silver extends gains

Gold prices hit a record high of ₹1,17,697 in Ahmedabad on the Multi-Commodity Exchange (MCX) on Tuesday, after opening at ₹1,16,899 per 10 grams. In international markets, gold futures are trading at around $3,862.89 per troy ounce as of 10:45 IST. Silver prices also continued their rally, rising to a peak of ₹1,44,200 per kg on the MCX and $47.02 per ounce in international markets.

On Monday, spot gold surged past $3,800/Oz for the first time, reaching a record $3,834.20. Simultaneously, silver rose above $47, hitting a 14-year high driven by a weaker dollar and expectations of more U.S. rate cuts, along with strong safe-haven demand amid tariff uncertainty and the risk of a government shutdown. U.S. data showed pending home sales jumped 4% in August, reversing July’s decline and beating forecasts.

According to a Kotak Securities Research report, "Today, gold surpassed $3,850 amid rising concerns over the U.S. government shutdown, which began last Wednesday and could delay September’s nonfarm payrolls, as discussions between Trump and congressional leaders concluded without a short-term funding deal. Investors now await JOLTS job openings and CB consumer confidence for more clues."

Darshan Desai, CEO of Aspect Bullion & Refinery, said, "A recent meeting between key stakeholders ended without progress, fuelling uncertainty. The looming shutdown threatens to delay critical economic data, including Friday’s U.S. jobs report, potentially heightening market volatility and boosting demand for safe-haven assets. Gold is on track for its third consecutive quarterly gain, supported by ETF holdings climbing to their highest levels since 2022. Investors are also pricing in a weaker jobs report, which could prompt the Federal Reserve to consider an interest rate cut at its upcoming meeting on October 29."

The investment mood in India has decidedly turned bullish on bullion. "Gold prices are currently benefiting from pressures of global safe-haven demand and a weakening rupee," said Aksha Kamboj, vice president, India Bullion & Jewellers Association (IBJA), and executive chairperson, Aspect Global Ventures.

The price of 24-karat gold is now around ₹1,17,697 per 10 grams, reflecting recent growth in domestic demand, she added. "The upward trend is consistent with gold futures reaching new highs and inflows into gold ETFs, as the recent market watch explained. The price has risen from recent levels, indicating a clear appreciation."

Analysts suggest that, unless there are surprises in global monetary policy or the dollar gains strength again, the price of gold is likely to stay within its recent high range.