Gold and silver prices witnessed a sharp increase in the Delhi bullion market on Tuesday, driven by the Indian rupee sliding to a record low against the US dollar. The rupee depreciated by 35 paise to close at an all-time low of 95.63 (provisional) against the greenback, providing strong support to domestic precious metal rates.
Rupee Weakness Boosts Bullion
The continuous depreciation of the rupee has made imports more expensive, pushing up gold and silver prices in the domestic market. Traders noted that the rupee's weakness is a key factor behind the recent rally in bullion prices, as India is a major importer of gold and silver.
Gold and Silver Rates
In Delhi, gold of 24 karat purity rose by Rs 450 per 10 grams to trade at Rs 72,850, while silver climbed by Rs 800 per kilogram to reach Rs 88,500. The surge in prices was also supported by strong global cues, with international gold prices hovering near multi-week highs.
Market analysts attribute the rupee's fall to sustained foreign fund outflows and a strong US dollar index. The domestic currency has been under pressure due to global economic uncertainties and trade tensions.
Investors are now closely watching the Reserve Bank of India's (RBI) next move, as a weaker rupee could prompt further monetary policy adjustments. Meanwhile, demand for gold as a safe-haven asset remains robust amid geopolitical risks and inflationary concerns.
The bullion market is expected to remain volatile in the coming sessions, with the rupee-dollar exchange rate and global economic data acting as key triggers.
