Gold Hits Record High on Fed Rate Cut Hopes
Gold prices surged to unprecedented levels on Wednesday, with domestic futures reaching ₹1,27,500 per 10 grams and global prices breaching $4,200 per ounce. The rally was driven by strong safe-haven demand amid escalating geopolitical tensions and growing optimism about US Federal Reserve rate cuts.
Key Takeaways
- Gold futures hit record ₹1,27,500/10g domestically
- Global gold prices crossed $4,200/oz for first time
- Silver also surged with December futures at ₹1,60,760/kg
- Fed Chair Powell’s dovish remarks fueled market optimism
Domestic Market Performance
On the Multi Commodity Exchange (MCX), gold futures for December delivery climbed ₹1,244 (0.98%) to reach a historic high of ₹1,27,500 per 10 grams. This marked the fourth consecutive session of gains. The February 2026 contract also appreciated by ₹943 (0.73%) to a new peak of ₹1,28,435 per 10 grams.
Silver joined the bullion rally with December delivery futures increasing by ₹1,256 (0.78%) to ₹1,60,760 per kilogram. The white metal had touched an all-time high of ₹1,62,700 per kg on Tuesday.
Global Market Momentum
In international markets, Comex gold futures for December delivery surged nearly 2% to hit a record $4,211 per ounce.
“Gold prices climbed to USD 4,200 per ounce and extended its bullish run to notch a fresh record as investors sought the metal’s safety and ramped up bets of additional US monetary easing,” Jigar Trivedi, Senior Research Analyst at Reliance Securities, said.
Driving Factors Behind the Rally
The bullion rally has been fueled by multiple factors including renewed US-China trade tensions and growing expectations of US interest rate cuts. Federal Reserve Chair Jerome Powell’s recent comments at the NABE conference reinforced market expectations of two more rate cuts this year.
Meanwhile, escalating trade tensions added to the risk-off sentiment. US President Donald Trump accused China of ‘economically hostile’ behavior, while Beijing warned of further retaliation following sanctions on US units of South Korean shipbuilder Hanwha Ocean.
The International Monetary Fund’s latest World Economic Outlook report, while raising global growth forecasts for 2025, warned that ongoing US-China trade frictions could threaten global economic stability.
