Gold Prices Surge on Bargain Hunting; Value Buying Boosts Demand Amid Weak US Dollar
Precious metal demand revived as traders capitalize on lower prices, sending gold and silver higher in major Indian markets. Gold edged up by Rs 400 to reach Rs 1,48,500 per 10 grams in the national capital on Friday. Silver also saw a significant jump, surging Rs 5,000 to reach Rs 2,37,000 per kilogram (inclusive of all taxes).The recovery is largely attributed to value buying by traders and the weakening US dollar index, boosting the appeal of precious metals domestically. The yellow metal of 99.9 per cent purity closed at Rs 1,48,100 per 10 grams during the preceding session.
Precious Metals Surge on Value Buying in Indian Markets
Traders noted that the recovery momentum came after gold had previously touched a one-week low earlier this week. This pullback provided an ideal opportunity for bargain hunting among investors. Saumil Gandhi, Senior Analyst - Commodities at HDFC Securities, observed that "Gold prices traded modestly higher on Friday as a weak US dollar and bargain buying supported sentiment."Silver also snapped its three-session losing streak, climbing by Rs 5,000 from Thursday's closing level of Rs 2,32,000 per kg. This rally underscores the renewed investor confidence in commodities amid currency dynamics.
International Trends: Global Diplomatic Efforts Support Gold Firmness
In contrast to the domestic rise, international markets saw a mixed performance for key metals. Spot gold slipped by $17.57, or 0.43 per cent, settling at $4,106.25 per ounce. Meanwhile, silver fell nearly 1 per cent, trading at $59.54 per ounce.Praveen Singh, Head of Commodities at Mirae Asset ShareKhan, noted that spot gold remains firm due to diplomatic efforts between the US and Iran that appear set to strike a deal. This geopolitical optimism is providing underlying support for global metal prices.
Investor Focus Shifts Ahead of CPI Data Release
Market participants are now focusing heavily on forthcoming macroeconomic data for guidance. The upcoming US Consumer Price Index (CPI) report, expected next week, is anticipated to be a critical factor in the market trajectory.Jateen Trivedi, VP Research Analyst - Commodity and Currency at LKP Securities, stated that "The data release will be a key trigger for the Federal Reserve’s interest rate outlook and the direction of bullion prices." The CPI data will provide crucial insight into the Federal Reserve's future path regarding interest rates.
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