In recent days, the gold market in Delhi has witnessed a significant surge in prices, closely following Donald Trump’s inauguration. This increase brings gold prices perilously close to record highs as both domestic and international markets react to growing trade war concerns. In this article, we will explore the reasons behind the price rise, the current market scenario, and expert opinions on the future of gold prices.
Gold Prices Rise in Delhi
According to the All India Sarafa Association, gold prices in Delhi rose by ₹100, reaching ₹82,100 per 10 grams on Tuesday. The previous day, the precious metal had closed at ₹82,000 per 10 grams. Gold with 99.5% purity also saw a similar increase, priced at ₹81,700 per 10 grams. This marks a significant milestone, as gold prices in Delhi are now at a high level not seen in recent history.
Price Comparison Table
| Date | Gold Price (per 10 grams in ₹) | Silver Price (per kilogram in ₹) |
|---|---|---|
| Monday | 82,000 | 93,000 |
| Tuesday | 82,100 | 93,000 |
MCX Futures Show Increase in Gold Prices
On the Multi Commodity Exchange (MCX), the February gold futures contract traded at ₹78,970 per 10 grams, reflecting an increase of ₹426 or 0.54% on Tuesday. Similarly, silver futures for March delivery rose by ₹188 or 0.21%, reaching ₹91,630 per kilogram. In contrast, silver on Comex settled down by 0.15%, trading at $31.10 per ounce. Meanwhile, global gold futures on Comex witnessed a drop of $18.20 or 0.66%, now priced at $2,730.50 per ounce.
Factors Influencing the Rise in Gold Prices
According to Jatin Trivedi, VP Research Analyst (Commodity and Currency) at LKP Securities, the surge in gold prices is largely driven by increased uncertainty in global trade, particularly following Trump’s decision to raise tariffs on imports from Mexico and Canada. Commodity experts noted that after touching its highest levels since November 6, the gold price began to decline, but currently remains in the $2,725 range in ongoing trading.
Impact of Trade Uncertainty
Trump’s tariff remarks have raised concerns about a new wave of global trade wars, which is contributing to fluctuations in gold prices. Additionally, indications that the U.S. Federal Reserve may cut interest rates twice this year may limit any corrective declines in precious metal prices, as they often move inversely to interest rate fluctuations.
Expert Opinions on the Market Outlook
Sourabh Gandhi, Senior Analyst at HDFC, stated that the focus remains on Trump and his next policy moves, which could potentially lead to more volatility in the gold market. Manav Modi, a Commodity Research Analyst at Motilal Oswal Financial Services Limited, mentioned that market participants will closely monitor updates from the Davos summit, which may impact market stability. Moreover, the U.S. markets will restart after the holiday, possibly resulting in further price fluctuations.
Conclusion
As we move forward, the price dynamics of gold in Delhi and beyond will be pivotal for investors and traders alike. Keeping an eye on global trade negotiations, monetary policies, and market sentiments will be crucial for understanding future price movements in this precious metal.