Gold prices on MCX (August futures) surged to a historic peak of ₹1,01,078 per 10 grams, surpassing the ₹1 lakh mark for the first time following Friday’s close above this psychological level. This rally was fueled by multiple factors including:
Global equity market pressures — Investors moved away from riskier assets amid volatile stock markets.
Rising crude oil prices — Higher oil prices typically stoke inflation concerns, which increase demand for gold as an inflation hedge.
A weakening US Dollar Index (DXY) — A softer dollar makes gold cheaper for holders of other currencies, supporting price gains.
Silver also remained buoyant, with July futures steady near recent highs at ₹1,06,464 per kg, reflecting similar safe-haven demand dynamics.
Key Drivers Behind the Rally
Geopolitical tensions: The ongoing Israel-Iran conflict has intensified risk aversion, pushing investors towards safe-haven assets like gold and silver.
Dollar Index movements: The DXY was trading near 98.28, showing slight gains, but overall remains in a range that supports precious metal prices.
Crude oil price surge: Rising oil prices increase inflation expectations, strengthening gold’s appeal.
Domestic currency dynamics: A weakening Indian rupee against the dollar further boosts the rupee-denominated gold price, making imports costlier.
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