Gold rebounds Rs 572 to Rs 1,09,624/10 g on value buying, firm global cues

New Delhi: Gold prices snapped their three-day losing streak and rebounded by Rs 572 to Rs 1,09,624 per 10 grams in the domestic futures market on Friday driven by value buying and firm global cues after the US Federal Reserve's rate cut.

On the Multi Commodity Exchange (MCX), gold futures for October delivery climbed Rs 572 or 0.52 per cent to Rs 1,09,624 per 10 grams in a business turnover of 12,685 lots. Similarly, the December contract appreciated Rs 516 or 0.47 per cent to Rs 1,10,650 per 10 grams.

"Gold price witnessed high swings, as after recording some profit booking, a quick recovery was seen in the session. The US Federal Reserve resumed rate cuts and opened the door to further easing, but tempered its message with warnings of sticky inflation, sowing doubt over pace of future easing," said Manav Modi, Analyst – Precious Metal -Research, Motilal Oswal Financial Services Ltd.

Silver prices also surged in line with gains in gold. The white metal futures for December delivery rallied Rs 1,668 or 1.31 per cent to Rs 1,28,800 per kilogram in 17,935 lots.

The March next year contract climbed Rs 1,573 or 1.22 per cent to Rs 1,30,224 per kg on the MCX.

In the international market, gold futures for December delivery rose USD 13.40 or 0.36 per cent to USD 3,691.70 per ounce while silver futures gained 1.22 per cent to USD 42.67 per ounce.

On Wednesday, the US Federal Reserve (Fed) lowered its benchmark rate by 25 basis points to a range of 4–4.25 per cent, its first cut since December. Policymakers projected two additional cuts in 2025, but only one in 2026, signalling a cautious approach.

Meanwhile, Fed Chair Jerome Powell described the move as a risk-management cut in response to a weakening labour market and said the central bank was in a "meeting-by-meeting situation" regarding the rate outlook.

The Fed's cautious tone, however, prompted some investors to take profits after bullion's surge to record highs on Thursday.

"Dot plot showed that there was no change in rate cut probability in 2026 and 2027 while, growth forecast was also increased keeping the market on the edge regarding the monetary policy ahead.

"Meanwhile, gold exports from Switzerland to China jumped 254 per cent in August compared with July. As the Fed cut its interest rates after an eight-month pause, Bank of England and People's Bank of China kept their interest rates unchanged in a recent announcement," Modi said.

So far this year, gold has surged nearly 39 per cent, supported by expectations of monetary easing, geopolitical uncertainty and robust central bank purchases.