On the first trading day of the week i.e. Monday, there was a huge jump in the prices of silver in the bullion market of Delhi. Due to the rise in global markets and weakening US dollar, the prices of white metal i.e. silver have started skyrocketing in the domestic market. On Monday, a huge increase of Rs 17,000 per kg was recorded in the price of silver in a single day. At the same time, gold prices also showed an upward trend and crossed the level of Rs 1.58 lakh. Market experts believe that this rise has happened due to increase in demand for precious metals as a safe investment.
Domestic market gets momentum due to global cues
According to market data, the price of silver jumped 6.66 percent to Rs 2.72 lakh per kg on Monday. Its closing price on Friday was Rs 2.55 lakh per kg, which has increased by Rs 17,000 today. Similarly, the price of gold of 99.9 percent purity also increased by Rs 1,300 and reached the level of Rs 1.58 lakh per 10 grams. In the last session, gold had closed at Rs 1.57 lakh. According to Saumil Gandhi, Senior Analyst (Commodities), HDFC Securities, in the international market, spot silver was trading 2.81 percent higher at $ 80.21 an ounce and gold was trading 1 percent higher at $ 5,012.94 an ounce, which has a direct impact on the Indian markets.
Weakness in dollar and impact of Trump’s policies
One of the main reasons for this rise in precious metals is the weakness in the US dollar. The dollar index fell 0.30 percent to 97, which supported bullion prices. Saumil Gandhi said that widespread economic uncertainty at the global level and US President Donald Trump’s continuous statements on geopolitical and tariff related issues have also turned investors towards safe investments. Whenever there is uncertainty in the global economy, investors consider it safe to invest in gold and silver instead of risky options like the stock market.
Market sentiment changed due to China’s purchases
China also has a big role in strengthening the market sentiment. According to the data, the People’s Bank of China continued purchasing gold for the 15th consecutive month in January. Despite high prices, China’s central bank increasing gold reserves is a positive sign for global investors. Gaurav Garg, Research Analyst, Lemon Markets Desk, says that there has been a recovery in metals after last week’s huge fluctuations. However, silver still remains highly volatile, reflecting speculative capital flows and short-term profit taking. Domestic buying and international cues lifted prices, although some profit-booking was seen at the day’s highs.
Investors now eye American economic data
Market experts say that American economic data will decide the movement of gold and silver in the coming days. Traders are eagerly awaiting the US monthly employment data to be released on Wednesday. Apart from this, US consumer inflation data is also going to be released on Friday. According to HDFC Securities, both these reports will play an important role in determining the direction of the dollar and will give new signals for the precious metals. If inflation figures are more or less than expected, there may be a possibility of change in the policies of the Federal Reserve regarding interest rates, which will have a direct impact on the prices of gold and silver.
