Gold Prices Surge Past Rs 1 Lakh Mark Again Today
Gold and silver prices have surged significantly amid escalating tensions between Israel and Iran, with gold futures on the Multi Commodity Exchange (MCX) reaching a record high of Rs 1,00,403 per 10 grams. This increase, amounting to Rs 2,011 or 2.04%, is attributed to safe-haven buying as investors seek refuge from geopolitical uncertainties. Silver also saw a rise, starting at Rs 1,06,695 per kg, reflecting an increase of Rs 810 or 0.76%. The previous day had already shown positive trends for both metals, indicating a growing demand for precious assets in uncertain times.
Factors Driving the Price Surge
The recent spike in gold and silver prices can be traced back to heightened tensions in the Middle East, particularly between Israel and Iran. As international gold prices surpassed $3,400 per troy ounce, Indian gold futures crossed the Rs 1 lakh mark for the first time. The weakening of the dollar index, which registered a decrease of 0.31%, has further bolstered the appeal of precious metals. Investors are increasingly concerned about potential disruptions to global oil supply routes, especially through critical areas like the Strait of Hormuz.
On Friday, Israel confirmed that it had conducted airstrikes in Iran, targeting facilities linked to nuclear and missile development. This military action has intensified fears of broader conflict in the region. Additionally, recent economic data from the United States, including a rise in unemployment claims and lower inflation rates, has led to speculation about possible interest rate cuts by the Federal Reserve, further influencing the attractiveness of gold and silver as safe-haven investments.
Market Reactions and Predictions
Market analysts are closely monitoring the situation, with expectations of continued volatility in gold and silver prices. Manoj Kumar Jain from Prithvifinmart Commodity Research noted that gold prices have reached six-week highs, and sustained prices above $3,400 could indicate further strength in the market. He anticipates that gold may hold key support levels around $3,330 per troy ounce, while silver could stabilize around $35.00 per troy ounce on a weekly closing basis.
Renisha Chainani, Head of Research at Augmont, expressed that unless there is a significant shift in global risk sentiment or aggressive monetary tightening, gold prices are likely to remain firm. She predicts that gold could potentially rise to Rs 1,05,000 in the medium term. Meanwhile, Manav Modi, a Senior Analyst at Motilal Oswal Financial Services, highlighted that gold has surged over 30% since the beginning of the year, despite fluctuations in price.
Long-Term Outlook for Precious Metals
The long-term outlook for gold and silver remains optimistic, according to market analysts. Modi identified crucial support levels between Rs 88,000 and Rs 90,000 per 10 grams, suggesting that investors should consider purchasing during price dips. His forecast indicates that gold prices could advance to between Rs 1,00,000 and Rs 1,06,000 over the next 12 to 15 months, provided that these support levels hold.
The fluctuations in precious metal prices are influenced by various factors, including changes in tariffs, geopolitical tensions, and concerns about global economic growth. Despite adjustments in US-China tariffs, ongoing market uncertainty and disappointing economic indicators in the US continue to support gold valuations. As the situation evolves, investors are advised to stay informed and consider the potential impacts of geopolitical developments on their investment strategies.
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