Aided by a weakening greenback and plunging treasury yields, gold prices zoomed on Wednesday. In the domestic markets, as measured by spot prices in the national capital, gold price rallied ₹1,025 to touch a life-time high of ₹61,080 per 10 grams, as per HDFC Securities. In the previous trade, the precious metal had settled at ₹60,055 per 10 grams.
“Spot gold prices in the Delhi markets traded at ₹61,080 per 10 grams, up ₹1,025 per 10 grams. In the domestic market gold prices crossed the ₹61,000 level per 10 grams to a fresh life-time high,” Saumil Gandhi, senior analyst-commodities at HDFC Securities, said.
Silver also zoomed ₹1,810 to ₹73,950 per kilogram. The dollar eased after weak US economic data fanned expectations that the Federal Reserve might loosen its monetary policy trajectory.
Bullish sentiment in bullion
In the overseas market, both gold and silver were quoting higher at $2,027 per ounce and $24.04 per ounce, respectively. Comex gold prices rose to a fresh 13-month high on Tuesday, up by 1.9% and closed at $2,038.2 per troy ounce.
“Recent sets of economic data from the US have pointed to a slowing economy and improved the conviction that the Fed may not need to raise rates much further and could even pause the tightening cycle in May,” said Ravindra V Rao, VP-head commodity research, Kotak Securities.Investors now see a 59.2% probability the Fed will leave the fed funds rate steady during the May FOMC meeting. A note by Chirag Mehta, CIO & Ghazal Jain, fund manager at Quantum AMC on April gold price outlook said that markets are now pricing in a less hawkish Fed and only one more rate hike this year. A pause in the Fed’s hiking cycle will be supportive of gold prices, they added.
Comex gold prices rallied in Asian trading hours on Wednesday and have surged more than 1.8% since March 2022 amid data showing lower than estimated US jobs openings. Additionally, US dollar index and bond yields declined post US macro data which boosted bullish sentiment in bullion, Gandhi said.