Gold & Silver Prices Rise On MCX, Weaker US Dollar & Fed Rate Cut Hopes Boost Demand

Mumbai: Gold prices rose on the Multi Commodity Exchange (MCX) on Friday. December gold futures went up by 0.38 percent and were trading at Rs 1,20,951 per 10 grams. Silver futures were mostly steady, after reaching a record high in the previous session.

Weaker US Dollar Supports Prices

The US dollar index dropped by more than 0.20 percent. A weaker dollar makes gold cheaper for buyers using other currencies. Since gold is priced in US dollars, any weakness in the dollar usually pushes up gold demand worldwide.

Previous Record Highs

In the last trading session, gold had touched an all-time high of Rs 1,23,677 per 10 grams, while silver also hit a record of Rs 1,53,388 per kilogram. Even though prices eased slightly due to profit-booking, they remain on a strong upward trend.

Why Are Gold Prices Rising?

Experts say global uncertainties—especially in the US, Japan, and France—are making investors turn to safe-haven assets like gold. Key reasons include:

- Possible interest rate cuts by the US Federal Reserve

- Political instability in some countries

US government shutdown worries

Traders now expect a 25-basis-point rate cut by the US Fed in October with a 95 percent chance, and another one in December with 82 percent probability. These expectations are pushing gold prices higher.

International Gold Market Trends

US gold futures are set for their eighth week of gains. However, prices briefly crossed USD 4,000 per ounce before falling—marking the biggest drop in two months.

Analysts say this happened because of profit-taking and a small recovery in the dollar’s value. Also, news of a Gaza ceasefire reduced the need for 'safe-haven' buying.

Oil Prices Also Fall

Oil prices dropped 1.6 percent to around USD 65 per barrel. The ceasefire in Gaza and higher oil inventories in the US, reported by the Energy Information Administration (EIA), helped ease supply concerns.

Gold and silver prices are expected to stay firm in the near term. Global events, interest rate expectations, and currency movements will continue to influence metal prices on the MCX and international markets.