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Informist, Wednesday, Mar. 19, 2025

By Ashutosh Pati

MUMBAI – Futures contracts of gold were marginally down on the Multi Commodity Exchange of India as the rupee appreciated against the dollar. On the COMEX, gold prices rose as heightened geopolitical tensions in West Asia and concerns over a potential global trade war boosted the precious metal's safe-haven appeal.

At 1800 IST, the most-active April GOLD contract on the MCX was down 0.1% at INR 88,667 per 10 grams, after hitting a fresh lifetime high of INR 89,014 per 10 gm. The most-active April gold contract on COMEX was up 0.2% at $3,045.8 per ounce. The contract hit a fresh lifetime high of $3,052.4 per ounce earlier in the day.

The rupee appreciated by 0.15% and closed at an over seven-week high of 86.44 against the dollar. When the rupee appreciates against the dollar, it makes imports cheaper for Indian buyers, which weighs on gold prices.

Israel airstrikes pounded the Gaza strip on Tuesday killing over 400 people, breaking the ceasefire that was in effect since mid-January. Moreover, Israeli Prime Minister Benjamin Netanyahu hinted at more such attacks. "This is just the beginning," Netanyahu said in a televised address.

"These moves reflect market's increasing uncertainty regarding geopolitics, tariff implementation, and the path of monetary policy, which may keep gold prices high in the near term," analysts at Sucden Financial said in an e-mailed note.

SILVER contracts fell on the MCX tracking a fall in contracts on the COMEX because of a firm dollar. At 1805 IST, the Dollar Index, which measures the strength of the greenback against a basket of six major currencies, was up 0.3% at 103.55. A stronger greenback makes dollar-denominated commodities expensive for those holding other currencies, denting demand.

At 1807 IST, the most-active May contract on the MCX was down 0.6% at INR 100,671 per kilogram. The same-month contract on the COMEX was 0.8% lower at $34.55 per ounce.

Investors will closely watch the US Federal Open Market Committee's policy meeting early Thursday. Market participants expect the FOMC to keep rates unchanged, but any dovish signals on future monetary policy decisions may strengthen the yellow metal's momentum.

Outlook for the rest of the session:

--MCX gold seen at INR 87,602–INR 89,718 per 10 gm

--COMEX gold seen at $2,982.8–$3,075.9 an ounce

--MCX silver seen at INR 98,319-INR 102,691 per kg

--COMEX silver seen at $32.81-$34.56 an ounce

End

US$1 = INR 86.44

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Ashish Shirke

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