Gold prices rebound to ₹1,24,700 per 10 gram, silver rallies to ₹1,53,300 per kg; here’s why

After falling for two consecutive sessions, gold rates (99.9% purity  24K) rebounded on Thursday, rising by ₹600 to ₹1,24,700 per 10 gram in Delhi on the back of a fresh buying wave by traders and firm global cues. 

Gold of 99.5% purity rose to ₹1,24,100 per 10 gram after closing at ₹1,23,500 per 10 gram on Tuesday, according to the All India Sarafa Association. 

Silver soared ₹1,800 to ₹1,53,300 per kg on Thursday after settling at ₹1,51,500 per kg on Tuesday. 

Bullion markets were closed on Wednesday on the occasion of Prakash Gurpurb Sri Guru Nanak Dev holiday. Stock markets and banks in many states also remain shut across the country. 

In global markets, spot gold jumped $28.96, or 0.73% to $4,008.19 per ounce. Spot silver was trading 1.22% higher at $48.60 an ounce.

As per market analysts, gold rallied on Thursday as safe-haven demand rose and the US dollar fell modestly. The ongoing US government shutdown has become the longest one in the country’s history, and no resolution seems to be near. 

Gold, as a safe-haven asset, rises in uncertain situations, volatile markets, central bank buying and weak currencies.  

The dollar index, which gauges the greenback's strength against a basket of six currencies, fell by 0.29% to 99.97, after surging to a multi-month high in the previous session. This boosted the precious metals further. 

Gold, silver futures

In futures trade on the Multi Commodity Exchange, gold and silver contracts rose on Thursday amid firm global cues. 

Gold futures for the December delivery rose to an intraday high of ₹1,21,550 per 10 gram, while silver soared to ₹1,49,040 per kg on the MCX.

Investors are expected to remain cautious of speeches from several Federal Reserve officials, including John Williams and Michael S Barr, later in the day, as per commodities market experts. 

"The commentary will provide more impetus on the central bank's monetary policy path and could influence the near-term trajectory for bullion prices," a PTI report quoted an expert as saying.