Gold hits record high of ₹1.06 lakh on hopes of Fed rate cut

Gold prices touched an all-time high as it opened at ₹106,500 per 10 grams in Ahmedabad on the Multi Commodity Exchange (MCX) on Thursday. In international markets, gold futures are trading around $3,530 per troy ounce as of 11:00 am IST.

"Gold prices are witnessing some profit-taking at higher levels in global markets following a sharp rally, as investors await the crucial U.S. jobs report due on Friday,” said Darshan Desai, CEO of Aspect Bullion & Refinery. The rally followed weaker-than-expected U.S. JOLTS job data, which showed openings at 7.18 million compared to the forecast of 7.38 million. The softer labour market figures dragged the dollar index lower, providing a lift to precious metals. 

“With markets pricing in a near 100% chance of a rate cut by the FOMC on September 17, gold is expected to find strong support at lower levels. On the domestic front, the decision to keep GST rates unchanged on gold and silver offers much-needed clarity for bullion and jewellery traders ahead of the key festive season. This also brings reassurance to potential buyers who may have been holding back in anticipation of further policy updates," added Desai.

“Traders almost fully priced in a 25-basis point rate cut, with the CME FedWatch Tool showing a 98% probability of easing at the upcoming policy meeting… Most importantly, the official U.S. jobs report due Friday is expected to show a fourth straight month of subdued payroll growth. If the data come in weaker than anticipated, it may boost the case for deeper Fed rate cuts in the coming months,” said Kaynat Chainwala, AVP– commodity research, Kotak Securities.

Silver prices also extended their gains on Thursday, reaching historic levels in both global and domestic markets. Silver was being sold at ₹1.36 lakh per kg in India on Thursday. "Gold scaled a fresh all-time high, while silver reached its highest level in 14 years, as investor demand for safe-haven assets and hopes of a Federal Reserve rate cut further strengthened sentiment," said Rahul Kalantri, VP Commodities, Mehta Equities Ltd.

Gold has shown a tremendous rally over the past year, rewarding investors with a nearly 49% return. The price jumped from ₹71,000 per 10 grams to ₹1,06,000 in just twelve months on the MCX.

Aksha Kamboj, vice president, India Bullion & Jewellers Association (IBJA), and executive chairperson, Aspect Global Ventures, said, "Amid escalating global economic unease, investor appetite for gold remains unwavering, reflecting its enduring strength as a safe-haven asset. Market participants continue to monitor rate-cut expectations and geopolitical tensions, which are driving momentum in the gold market."

The current domestic valuation underscores resilient demand even in the face of broad market fluctuations, he said. “Given the sustained upward trend and limited downside, our outlook suggests that price stability may persist in the short term," added Kamboj.

Analysts say that while speculative traders remain active, long-term investors view current levels as a reasonable entry point for preserving their wealth. Overall, the trajectory for gold continues its upward march, rooted in a confluence of macroeconomic uncertainty and investor confidence in the metal’s intrinsic value.