New Delhi, March 10 Silver prices jumped by Rs 10,442 to Rs 2.77 lakh per kilogram in the futures trade on Tuesday, tracking strong gains in the global markets as a weak US dollar boosted demand for the precious metals.
On the Multi Commodity Exchange, the white metal for May delivery soared by Rs 10,442, or nearly 4 per cent, to Rs 2,77,602 per kilogram in a business turnover of 2,300 lots.
Analysts said silver prices rebounded after a decline in the previous session, driven by a pullback in the dollar and improved sentiment in the international markets.
In the overseas markets, silver futures for May contract gained USD 5.07, or 6 per cent, to trade at USD 89.59 per ounce in New York.
"Silver rebounded to around USD 90 after briefly slipping below USD 80 in the previous session, supported by a pullback in the US dollar," Renisha Chainani, Head - Research at Augmont, said.
According to Chainani, expectations grew that the Iran conflict could end sooner than initially feared, reduced safe-haven demand for the dollar, allowing precious metals to recover.
On Monday, US President Donald Trump indicated that the military operation in Iran is nearing completion and progressing faster than the initial four-to-five-week timeline.
He also signalled potential waivers on oil-related sanctions and plans for the United States Navy to escort tankers through the Strait of Hormuz, aiming to stabilise crude oil flows and prevent a sharp spike in energy prices.
"Investors are now focusing on the upcoming US inflation indicators, including the Consumer Price Index (CPI) and the Personal Consumption Expenditures (PCE) Price Index, which will provide further signals on inflation trends and potential monetary policy direction," Chainani said.
On the outlook, she further stated that after achieving the USD 90 per ounce target, silver remains supported and continues to show the upward momentum, with the next upside level seen around USD 95 per ounce (equivalent to Rs 2.85 lakh per kg in the domestic markets).
However, she added that any short-term corrections in prices could attract fresh buying interest from investors.