Silver futures hit lifetime high of ₹1.29 lakh per kg, gold futures at fresh peak of ₹1.1 lakh per 10 gram on Fed rate cut bet

Silver futures on Tuesday, September 16, jumped to another lifetime high of ₹1,29,878 per kg on the Multi Commodity Exchange, driven by rising expectations of a US Federal Reserve rate cut. 

Gold futures for the October delivery also climbed 0.33% (₹369) to hit a record high of ₹1,10,548 per 10 gram on the MCX on Tuesday. At around 2:50 pm, the contracts were trading with an open interest of 15,140 lots. 

Silver futures

Silver futures for the December delivery rallied 0.34% (₹449) to hit a record high of ₹1.29 per kg. The US Federal Reserve is scheduled to meet on September 16-17 to announce its decision on rate cuts. 

At around 2:50 pm, silver December futures were trading 0.27% (₹351) up at ₹1,29,780 per kg on the MCX. The contracts were trading with an open interest of 18,270 lots.

There is a growing belief that the easing cycle may continue into next year, which means that the Fed is expected to introduce more interest rate cuts in the near future. 

Silver contracts for the March delivery also hit a record high of ₹1,31,330 per kg on the MCX, rising by 0.35% (₹465) 

"Silver prices climbed to touch an all-time high in the domestic markets, supported by safe-haven demand, geopolitical concerns, and firm investment interest," a PTI report quoted Rahul Kalantri, Vice-President of Commodities at Mehta Equities Ltd, as saying. 

In the overseas markets, silver futures for the December delivery were trading at a fresh 14-year high of $43.09 per ounce, up 0.32%.  

Market experts believe that investors remain focused on the Fed’s upcoming policy announcement for guidance on the pace and extent of future rate cuts.

"Traders will closely monitor the US Federal Reserve's quarterly summary of economic projections, the dot plot, and Fed Chair Jerome Powell's press conference for clues about future policy direction. The meeting occurs amid challenges such as a legal dispute over Fed leadership and political pressure from US President Donald Trump," Kalantri added.

The US macroeconomic data, including retail sales and industrial production, which is due to be released later in the day, will also be analysed to determine the future trajectory and to gather further insights into the strength of the economy, the report quoted Jigar Trivedi as saying. 

The white metal has been gaining remarkable attention from investors who’re turning towards safer instruments amid market volatility and rising trade tensions globally. Silver has been breaking multiple records in both domestic and international markets.  

Gold futures

Gold has been rising, fuelled by strong global cues with rising expectations of a US Federal Reserve rate cut this week.

At around 2:50 pm, gold October futures were trading 0.31% (₹344) up at ₹1,10,523 per 10 gram on the MCX.

The gold prices maintained their upward momentum as traders bet on a rate cut by the Fed in its policy decision on September 17, while also looking for signals on further monetary easing through the rest of the year, according to a PTI report citing Commodities market experts.

In the overseas markets, gold futures for December delivery surged to a lifetime high of $3,728.32 per ounce on the back of expectations of looser US monetary policy and consistent demand for safe-haven assets amid global economic uncertainty.

Gold, as a safe-haven asset, thrives in uncertainties and market fluctuations.