Following Tuesday’s steep decline, Wednesday brought a fierce rebound in India’s precious metals market. Traders on the MCX watched gold and silver prices accelerate, erasing much of the prior day’s losses in a display of market resilience.
April gold contracts opened strong, gaining 1% to peak at 1,58,436 rupees for 10 grams during early sessions. Silver, which had plunged 10,000 rupees the previous day, bounced back with a 3% surge to 2,62,892 rupees per kilogram. As trading progressed to around noon, gold stabilized at 1,58,357 rupees (up 1%), and silver at 2,61,949 rupees (up 3.72% or 9,401 rupees).
The catalyst? Disappointing US retail sales figures for December, signaling slowing consumer spending and potential economic slowdown. This has ramped up speculation of more aggressive Fed rate cuts—now projected at three this year, up from two.
A softening dollar index to 96.59 enhanced appeal for international investors, while global markets mirrored the uptick. COMEX gold traded in the 4,900-5,100 dollar range post its recent high of 5,500-5,600 dollars, chalked up to healthy profit booking. Silver’s industrial usage and tight supplies provide a solid floor, with key support at 65-70 dollars.
Analysts outline MCX gold supports at 1,55,500/1,54,000 rupees and resistances at 1,57,700/1,59,000. Silver supports at 2,44,000/2,48,800, resistance near 2,60,000. Despite the bounce, prices lag all-time highs from January 29: 1,83,000 for gold, 4,20,000 for silver.
Investors remain glued to impending US jobs data and CPI releases, which could dictate the Fed’s next moves. Lower rates typically favor non-yielding assets like gold and silver, positioning them for potential further gains in a cautious economic landscape.