Mumbai’s bullion markets witnessed a dramatic rally on Monday as gold and silver prices soared amid a weakening US dollar and escalating geopolitical tensions worldwide. The MCX February gold contract jumped 1.31% to settle at 1,57,484 rupees per 10 grams, while March silver futures skyrocketed 4.81% to 2,61,900 rupees per kilogram.
The day started with silver leading the charge, peaking at 2,64,885 rupees per kilo—a nearly 6% gain—before profit-taking trimmed some gains. Investors flocked to safe-haven assets as the dollar index plummeted to its lowest since February 4, making dollar-denominated metals more affordable for international buyers.
Geopolitical jitters persist despite cautious optimism from Iran’s top diplomat on US-Iran nuclear talks. Tehran remains firm on its uranium enrichment rights, fueling uncertainty. Analysts warn these tensions could linger, driving sustained demand for gold and silver.
Adding fuel to the fire, San Francisco Fed President Mary Daly called for one or two more rate cuts to address labor market weaknesses. Expectations of Federal Reserve easing further bolster precious metals, which thrive in low-interest environments.
Technical charts show gold finding support at 1,54,000 and 1,51,800 rupees, with resistance at 1,57,700 and 1,60,000. Silver eyes support near 2,36,600 and 2,44,000, facing hurdles at 2,55,500 and 2,62,600.
Structural supply shortages in silver, coupled with robust industrial demand, provide a solid foundation. Central bank buying, safe-haven flows, and anticipated softer global monetary policies signal more upside potential. While prices may consolidate at elevated levels, investors are advised to balance portfolios amid volatility.