Gold price hits record high! Yellow metal jumps to $4,383.76 in early trade — What’s driving the rally?
Spot gold surged to $4,383.73 after fresh US economic data signalled continued weakness in the labour market, while easing inflation strengthened expectations of further monetary easing by the Federal Reserve. This took the yellow metal past its previous record high of $4,381.52, set in October.
The Fed, delivered a quarter-point rate cut last week, fuelling hopes of more easing ahead.
Investors are now expecting in two US rate cuts in 2026, a scenario that boosts the appeal of non-yielding assets such as gold. The precious metal, traditionally seen as a hedge in times of uncertainty, has risen 67% so far this year.
The rally has been driven by persistent geopolitical and trade tensions, strong buying by central banks and expectations of lower interest rates next year.
A softer dollar index has added further support by making gold cheaper for overseas buyers. The global momentum has also been reflected in domestic markets.
Last week, MCX gold futures climbed Rs 574, or 0.43% to hit an all-time high of Rs 1,35,590 per 10 grams on Thursday.
This marked the fourth consecutive weekly gain and puts gold on course for its twelfth straight monthly rise.Explaining the reason behind last week’s rally, Prathamesh Mallya of Angel One said, “weak dollar, dovish federal reserve, lower inflation data in the US triggered the momentum in gold prices in the recent week.” While gold has posted strong gains, silver has outperformed the yellow metal.
Last Friday, silver prices surged 8.08%, touching a record high of Rs 2,08,603 per kilogram.
The white metal has climbed more than 130% this year, supported by strong exchange-traded fund inflows and concerns around yen carry trades amid expectations of a rate hike by the Bank of Japan. Looking ahead, market experts remain optimistic about both metals but have flagged the possibility of near-term corrections.
Pranav Mer said silver could see further upside, though the risk-reward balance remains stretched. “We continue to maintain positive view in gold and expect prices to rise further to Rs 1,40,000-1,45,000 by early next year, with support for reversal placed at Rs 1,29,000 per 10 grams,” he said.(Disclaimer: Recommendations and views on the asset classes given by experts are their own.
These opinions do not represent the views of The Times of India)
