Chennai: Gold in the international market crossed the psychological level of $3000 per ounce amidst trade war, fears of an impending recession, unresolved geo-political uncertainties and interest rate cuts. Both gold and silver made new record highs in the domestic market.
Gold climbed to an all-time high level of $3002 on Friday, having moved up over $50 per ounce in three days. Gold prices at the MCX touched Rs 88,200 per 10 gm. The Multi-Commodity Exchange opened in the evening for trading due to the Hindu festival of Holi.
Silver once again scaled up to cross Rs 1 lakh mark and touched a new high of Rs 1,15,000 per kg. It had crossed Rs 1 lakh earlier in October.
“The ongoing US- China trade war, coupled with Trump’s 200 per cent tariff threats on European imports, has intensified safe-haven demand,” said Ajay Kedia, MD, Kedia Commodities.
Moreover, JP Morgan chief economist’s statement that there is about a 40 per cent chance of a US recession this year and a risk of lasting damage to the country’s standing as an investment destination if the administration undermines trust in the governance also has increased concerns in the market.
Over the past year, gold has gained sharply amid global economic instability, concerns over equity valuations, and a shift by central banks away from dollar-based reserve. The market also has been speculating that the Federal Reserve is expected to cut interest rates at least three times this year, adding to gold’s appeal.
“At $3,000, gold has already hit the 2025 price target set by us. The key resistance levels for gold now are $3070 and $3140. If the factors persist, we expect gold to overcome the resistance of $3140 in the first half of the year. This could see gold moving up to Rs 92,000 in the MCX,” said Kedia.
As for silver, Rs 1,30,000 per kg cannot be dismissed in the first of the year.
