Gold prices increased by Rs 2,700, reaching a new high of Rs 1,18,900 per 10 grams in the national capital, driven by ongoing global demand for this safe-haven asset, as the rupee depreciated significantly due to the rise in US H-1B visa fees. The All India Sarafa Association reported that the yellow metal, with 99.9% purity, closed at Rs 1,16,200 per 10 grams in the previous session. In the local bullion market, gold with 99.5% purity also saw a rise of Rs 2,650, hitting a record high of Rs 1,18,300 per 10 grams, up from Rs 1,15,650 per 10 grams on Monday. Traders noted that the rupee’s steep decline against the US dollar contributed to this increase.
Silver prices surged by Rs 3,220, reaching an all-time high of Rs 1,39,600 per kilogram, compared to Rs 1,36,380 per kg in the previous session. On Tuesday, the rupee fell 47 paise to an all-time low of 88.75 against the US dollar, amidst ongoing foreign fund outflows linked to the significant increase in US H-1B visa fees, which are projected to impact Indian IT services exports. In international markets, spot gold rose over 1% to a new record of $3,791.10 per ounce, while spot silver was trading 0.57% higher at $44.32 per ounce.
Kaynat Chainwala, AVP Commodity Research at Kotak Securities, noted that spot gold reached a new all-time high of USD 3,791 per ounce due to rising expectations of additional US rate cuts in 2025, along with news of China positioning itself as a custodian of foreign sovereign gold reserves. Chainwala also highlighted that momentum in precious metal prices had been building since Friday, when exchange-traded funds added 8.61 lakh troy ounces of gold, marking the largest one-day inflow since January 2022. SPDR Gold Trust reported a 0.60% increase in holdings to 1,000.57 tonnes, the highest level in over three years, further reinforcing bullish sentiment.
Renisha Chainani, Head of Research at Augmont, stated that gold prices reached a new record high, driven by expectations that the US Federal Reserve may further lower interest rates this year.