Gold and Silver Surge on US Dollar Softening and Fed Rate Cut Hopes

Precious metals experienced a substantial rally across global and domestic exchanges, driven by a powerful mix of macroeconomic tailwinds. On the Multi Commodity Exchange (MCX), near-term futures for gold climbed significantly, reaching ₹148,889 per 10 grams, while silver futures surged to ₹228,900 per kilogram. Retail rates mirrored this upward momentum, with Jos Alukkas quoting 24-karat gold at ₹14,689 per gram and GoodReturns pegging silver at ₹240,000 per kilogram. This robust price action underscores strong underlying demand and acute sensitivity to macroeconomic shifts.

International spot prices provided the primary catalyst for the domestic surge, with COMEX gold scaling $4,325 per troy ounce and silver touching $63 per troy ounce. A weakening US Dollar Index (DXY), which hovered near a seven-week low around 99.67, enhanced the appeal of dollar-denominated bullion for international buyers. Concurrently, easing geopolitical tensions surrounding the Middle East drove Brent crude below $79 per barrel, dampening global inflation expectations and scaling back aggressive Federal Reserve rate hike bets to just one potential increase by year-end.

Domestically, the Indian Rupee strengthened toward 95 per dollar, supported by reduced import bills from falling oil prices and proactive Reserve Bank of India interventions. The RBI's decision to maintain the repo rate at 5.25 percent injected stability into the domestic monetary environment. On the consumption front, retail jewelry demand transitioned toward lighter neo-heritage and fusion designs, offsetting a sharp 19 percent annual decline in solar photovoltaic silver thrifting. Meanwhile, central bank accumulation continued at a record pace globally, providing a strong structural floor for prices.

Bullion markets remain technically bullish in the near term, heavily dependent on upcoming US macroeconomic data prints and currency fluctuations. Investors are advised to monitor the sustainability of the DXY below key psychological thresholds and watch for any sudden shifts in central bank monetary policy stances. While short-term volatility is expected due to profit-taking, the broader structural deficit in silver and sustained official-sector gold purchases reinforce a constructive long-term outlook for precious metals.