Gold, silver futures hit record highs on Fed rate cut bets, weak dollar

New Delhi: Gold and silver prices scaled fresh lifetime highs in the domestic futures market on Monday, mirroring record gains in global markets amid expectations of US Federal Reserve rate cuts and a softer dollar buoyed sentiment.

On the MCX, the yellow metal futures for October delivery surged by Rs 1,204 or 1.06 per cent to touch a lifetime high of Rs 1,14,992 per 10 grams. The December contract for gold futures also advanced Rs 1,034 or 0.9 per cent, to hit a record Rs 1,15,925 per 10 grams.

Last week, gold futures rallied by Rs 4,188, or 3.77 per cent, to close at Rs 1,14,891 per 10 grams on Friday.

"Gold prices have been shining for quite some time, and the past week saw gold prices touching new highs in the domestic as well as international markets," said Prathamesh Mallya, DVP-Research, Non-Agri Commodities and Currencies at Angel One.

He noted that the rally showed no signs of pausing, with investors caught in a dilemma of whether to enter or book profits at elevated levels.

"Tariff levies, the Russia-Ukraine war, US-China trade tensions, and a host of other factors continue to drive liquidity and momentum in gold prices in the recent past," Mallya added.

Silver futures too witnessed robust gains on Monday. The white metal for December delivery jumped Rs 2,290 or 1.61 per cent, to hit an all-time high of Rs 1,44,179 per kilogram.

The March 2026 contract for silver futures surged by Rs 2,559, or 1.79 per cent, to a fresh peak of Rs 1,45,817 per kg on the Multi Commodity Exchange (MCX).

In the previous week, silver futures had surged by Rs 12,051, or 9.28 per cent, to close at Rs 1,41,889 per kg.

Globally, bullion prices continued their upward march. Gold futures for December delivery rose nearly 1 per cent to touch a record high of USD 3,837.72 per ounce while silver climbed more than 1 per cent to hit a high of USD 47.39 per ounce.

"Gold prices climbed to a record high, driven by growing expectations of further US rate cuts and a weaker dollar," said Jigar Trivedi, Senior Research Analyst at Reliance Securities.

He pointed out that the latest US Personal Consumption Expenditures inflation data matched market expectations and reinforced bets that the Federal Reserve could continue easing monetary policy later this year.

Meanwhile, the dollar index, which tracks the greenback against a basket of six currencies, was trading 0.18 per cent lower at 97.97, lending further support to precious metals.

"Traders are currently pricing in a 90 per cent chance of a rate cut in October and about a 65 per cent probability of an additional move in December. At the same time, investors are monitoring the risk of a potential US government shutdown, which could delay the release of key labour market data and complicate the Fed's decision-making process," Trivedi said.

Adding to the global uncertainty, US President Donald Trump last week announced a new round of tariffs on imported drugs, trucks, and furniture, effective October 1, clouding the economic outlook further.

Market experts said the interplay of monetary easing expectations, geopolitical tensions, and trade-related risks is expected to keep bullion prices elevated in the near term.