Gold prices have remained volatile in recent weeks, leaving investors uncertain about the metal’s near-term direction following a historic rally to all-time highs. As markets digest a mix of geopolitical unrest, economic data, and shifting trade dynamics, analysts say gold continues to serve as a safe-haven asset in the face of mounting global uncertainty.
Last Week’s Performance: Gold Gains, Silver Surges
Gold prices climbed to near a four-week high last week, supported by a weakening U.S. dollar and growing concerns over global political and economic stability. Meanwhile, silver broke past the ₹1 lakh mark on the domestic front, recording its strongest daily performance in over three weeks. Silver ended the week with a 2.7% gain in a single session, bolstered by a shift in investor sentiment and safe-haven demand.
“Gold’s rally continues to be underpinned by geopolitical tensions, macroeconomic data surprises, and technical buying,” said Manav Modi, Senior Analyst for Commodity Research at Motilal Oswal Financial Services Ltd. “The yellow metal has shown resilience amid an evolving risk landscape.”
Key Drivers: US-China Trade Talks, Russia-Ukraine Tensions, and Mixed US Data
Looking ahead, traders are eyeing a number of global developments that could drive gold prices in the week of June 9:
US-China Trade Relations: The upcoming round of trade negotiations between the United States and China is expected to be a major determinant of gold’s short-term direction. Uncertainty around tariffs and trade policy continues to weigh on global markets.
Geopolitical Risks: Tensions escalated further after Russia demanded territorial concessions from Ukraine as a condition to end the ongoing conflict, reinforcing the safe-haven appeal of precious metals.
Economic Indicators: While US non-farm payroll data came in stronger than expected—pointing to resilience in the labor market—other indicators painted a less rosy picture. Weaker manufacturing and services PMI data, coupled with disappointing private payroll numbers, have reignited fears of stagflation in the world’s largest economy.
Silver in the Spotlight
Silver, often dubbed “gold’s little brother,” has recently outperformed, reaching a 13-year high due to improved market fundamentals and strong technical momentum. The Gold/Silver ratio dropped sharply, highlighting silver’s relative strength.
Investor appetite for silver has also grown, as seen in increased ETF inflows, indicating rising institutional interest in the metal amid broader economic uncertainty.
Outlook and Investment Strategy
“With heightened global tensions and inflationary concerns, gold may continue to find support in the near term,” Modi said. “However, investor caution is advised, especially with key data points like US and China CPI figures expected this week.”
Analysts suggest that gold may trade in a consolidation phase, with resistance levels near recent highs and support holding at key psychological thresholds. The market will closely monitor inflation data and policy signals from central banks to assess whether gold’s recent gains can be sustained.
Should You Buy or Sell?
For investors considering gold, the strategy largely depends on risk appetite and investment horizon. Short-term traders may look for buy-on-dips opportunities, while long-term investors may choose to maintain exposure given the ongoing macroeconomic risks and gold’s historical role as a hedge against uncertainty.
Silver, having emerged as a strong performer, may continue to attract attention. However, its higher volatility suggests a more cautious approach, particularly for retail investors.
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