Gold and silver prices today: Yellow metal hits record high as investors bet on US rate cut

Gold prices opened on the Multi Commodity Exchange (MCX) on Wednesday at Rs 64,702 per 10 grams and hit an intraday low of Rs 64,679. In the international market, prices hovered around $2,126.30 per troy ounce.

Meanwhile, silver opened at Rs 73,203 per kg and hit an intraday low of Rs 73,022 on the MCX. The price hovered around $23.71 per troy ounce in the international market.

Manav Modi, Analyst, Commodity and Currency, MOFSL, "Gold scaled a record high moving further above $2,100 in a rally sparked by growing bets for a US interest rate cut in June and on safe-haven demand due to the conflict in the Middle East.”

A robust fundamental backdrop added support, including strong physical demand in Asia and central bank purchases.

“Dollar index and US 10 Yields have been very resilient during this volatility in commodities market, hovering around the 104 and 3.2% mark. The Fed chair Powell’s two day congressional testimony will be closely watched for more clarity on US interest rate path. Bets for a rate cut in June Fed meeting has increased from 40% to ~55% in a month,” said Modi.

Gold which is looked as a store of value during times of political and financial uncertainty, has climbed by over $300 since the Israel-Hamas war.

Also read: I'm 20 and earn Rs 76,000 a month. How much monthly investment is needed to save Rs 1 crore for a house by age 28, and where should I invest?

Also read: I am 25 and have started investing in life insurance policies and equity mutual funds schemes. Will the money received after 10 years be taxable in my hands?

Also read: I’m 62 and have a corpus of Rs 5 crore. My spouse is working, and son is settled abroad. Do I need a term insurance plan?

However, updates regarding cease fire and an ease off in the war will be important to keep an eye on. US Services PMI and factors data were reported lower than expectations in the previous session. "After series of weaker economic data last week focus now shifts to US labour market data scheduled this week, which if reported lower than expectations it could further increase gains for bullions,” said Modi.

Ravindra Rao, Head Commodity Research, Kotak Securitie, said, "COMEX Gold prices rose to $2150.5 per troy ounce on Tuesday, $2 shy of the record high touched in December, as weak economic data from US raised alarms about an economic slowdown and added to rate cut bets this year. Data released yesterday showed the ISM Services PMI fell to 52.6 in February 2024 from a four-month high of 53.4 in January, while the factory orders fell by 3.6% m/m in January, the biggest decrease since April 2020. US 10-year treasury plunged to a three week low, boosting the appeal for the non-yielding yellow metal. For the day, markets will be watchful of US JOLTs job opening, ADP employment change and Powell’s testimony. Caution ahead of Powell’s testimony might take some steam off the yellow metal."