Gold and silver prices surged to fresh record highs on Wednesday, driven primarily by strong demand during the festive and wedding season. The gold prices rallied for the sixth consecutive session, jumping by Rs 500 to an all-time high of Rs 81,500 per 10 grammes, according to the All India Sarafa Association. Silver prices also saw a significant rise, increasing by Rs 1,000 to reach a new high of Rs 1.02 lakh per kilogramme.
Gold of 99.9% purity and 99.5% purity rose by Rs 500 each, with prices at Rs 81,500 and Rs 81,100 per 10 grammes respectively. Meanwhile, silver jumped from its previous close of Rs 1.01 lakh per kg to Rs 1.02 lakh. Over the last six trading sessions, silver prices have surged by Rs 10,000 per kg, while gold has increased by Rs 2,850 per 10 grammes since Oct. 16.
The sharp rise in bullion prices can be attributed to several factors, including the seasonal demand during festivals, the wedding season in India, and geopolitical risks arising from conflicts in West Asia.
In July, gold and silver prices had corrected by around 7% following the government's reduction of basic customs duty on gold and other metals. However, the prices rebounded as demand from Indian consumers picked up due to the festive season, along with expectations of rate cuts in the US and escalating geopolitical tensions.
"Gold prices saw another positive move, supported by gains in Comex, where gold moved closer to $2,750. This in turn helped MCX gold stay above Rs 78,750, reflecting the underlying bullish sentiment. The ongoing favourable interest rate cycle has been one of the main factors supporting gold's rise," Jateen Trivedi, research analyst of commodity and currency at LKP Securities, told PTI.
In the futures market, gold contracts for December delivery on the Multi Commodity Exchange increased by Rs 112 or 0.14%, trading at Rs 78,768 per 10 grammes. Earlier in the day, gold reached a peak of Rs 78,919 per 10 grammes. The ongoing favourable interest rate cycle has also played a crucial role in supporting the rise in gold prices.
Meanwhile, silver futures for December delivery declined by Rs 456 or 0.46%, trading at Rs 99,516 per kg, after hitting an all-time high of Rs 1,00,081 per kg earlier in the day. Globally, Comex gold and silver prices also reached new highs, reflecting the growing demand for these precious metals amidst market uncertainties.
(With inputs from PTI)
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