Precious metals continued their upward trajectory on Wednesday, November 26, registering significant gains a day after posting strong growth. Both gold and silver prices climbed by over half a percent in early trading sessions, fueled by robust demand in the spot market and growing investor optimism surrounding potential interest rate cuts by the US Federal Reserve.
Market Snapshot: Key Figures
In specific terms, the rally was clearly visible in the futures market. MCX gold December futures were trading 0.50% higher at ₹1,25,835 per 10 grams around 9:10 am. Simultaneously, the white metal also shone brightly, with MCX silver December futures advancing by 0.91% to reach ₹1,57,750 per kg at the same time.
Drivers Behind the Rally
The positive momentum in bullion prices is primarily attributed to two key factors. Firstly, there is healthy demand in the physical spot market, which provides a solid foundation for the price increase. Secondly, and more influentially, are the mounting hopes for a rate cut from the US Fed. Expectations of a more dovish monetary policy in the United States tend to weaken the dollar and make gold, which is priced in dollars, cheaper for holders of other currencies, thereby boosting demand.
Context and Investor Outlook
This price surge comes on the back of solid gains of over one percent clocked just a day earlier, indicating a strengthening bullish sentiment for precious metals. Market participants are closely watching economic data and statements from the Federal Reserve for further cues on the timing of potential rate cuts. Analysts suggest that this trend could persist in the near term, depending on the evolution of macroeconomic indicators.
Please note: This is a developing story. Check back for fresh updates.
Disclaimer: This article is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, and not of Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
