New Delhi, February 4 (PTI) — Gold prices continued their upward trajectory, rising by Rs 500 on Tuesday to hit a new all-time high of Rs 85,800 per 10 grams in the national capital. This marks the fifth consecutive session of gains for the precious metal, driven by strong demand from jewellers and retailers, as reported by the All India Sarafa Association.
On Monday, gold of 99.9% purity closed at Rs 85,300 per 10 grams, but the price surged further on Tuesday, reflecting an overall increase of Rs 6,410 or 8.07% from Rs 79,390 per 10 grams on January 1.
In addition to the 99.9% purity gold, the price of 99.5% purity gold also rose by Rs 500, setting a new record of Rs 85,400 per 10 grams. This marked the fifth consecutive day of gains for both gold categories.
However, silver prices saw a reversal after a five-day rally. The metal fell by Rs 500 to Rs 95,500 per kg on Tuesday, down from Monday's closing price of Rs 96,000 per kg.
In the futures market, gold for April delivery on the Multi Commodity Exchange (MCX) saw a slight dip of Rs 208, or 0.25%, settling at Rs 83,075 per 10 grams. Silver futures for March delivery also dropped, falling by Rs 35 to Rs 94,222 per kg on the MCX.
Global Factors Influencing Gold Price Movement
While the domestic market saw a sharp rise in gold prices, futures trading revealed some signs of a slowdown. According to Jateen Trivedi, Vice President of Research at LKP Securities, gold’s rally took a brief pause in the futures market, trading around Rs 83,000. "The dip came amid increasing tariff discussions between the US, Canada, and Mexico, which introduced some uncertainty into the market," Trivedi explained.
On the international front, Comex gold futures for April delivery fell by USD 17, or 0.60%, to USD 2,840.10 per ounce. Earlier in the week, the yellow metal hit a fresh high of USD 2,872 per ounce, spurred by global geopolitical tensions.
Geopolitical and Economic Factors Driving Demand
Gold's recent surge has been partly driven by fears of a global trade war, particularly after US tariffs on Canada and Mexico were briefly paused. According to Chintan Mehta, CEO of Abans Holdings, these geopolitical uncertainties have propelled investors towards gold, which is considered a safe-haven asset. "Investors are willing to pay premiums for gold due to rising geopolitical tensions," Mehta said.
In addition, China’s central bank increased its gold reserves for the second consecutive month in December, a trend that has been observed among central banks globally, as they seek to hedge against economic volatility.
Meanwhile, silver futures in Asian markets also saw a decline, decreasing by 0.71% to USD 32.20 per ounce.
Focus on Upcoming Economic Data
As market participants await more economic indicators, investors are turning their attention to key US macroeconomic data, including the Job Openings and Labor Turnover Survey (JOLTS) and factory orders figures, which are set to be released later on Tuesday. Analysts believe these reports could offer further insights into the strength of the US economy, potentially influencing both the US dollar and gold prices in the short term.
In Summary:
- Gold prices hit a new record high of Rs 85,800 per 10 grams, marking an 8.07% increase since the start of the year.
- Silver prices, however, fell by Rs 500 to Rs 95,500 per kg after a five-day rally.
- Global economic and geopolitical factors continue to play a significant role in driving demand for gold as a safe-haven investment.
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