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Informist, Tuesday, Mar. 25, 2025

By J. Navya Sruthi

MUMBAI – Futures contracts of bullion on the Multi Commodity Exchange of India rose on Tuesday, tracking those on COMEX due to a weak Dollar Index. A weaker dollar makes commodities such as gold and silver, which are priced in the greenback, cheaper for buyers holding other currencies, aiding demand.

At 1738 IST, the Dollar Index, which measures the strength in the greenback against a basket of six major currencies, was down 0.2% at 104.09. Uncertainity over the announcement of reciprocal tariffs by the US on Apr. 2 and geopolitical tensions also supported prices of bullion. 

At 1738 IST, the most-active April GOLD contract on the MCX was up 0.4% at INR 87,598 per 10 grams. The most-active April gold contract on the COMEX was up 0.3% at $3,024.5 per ounce.

"Demand for safe-haven assets supports price gains, and gold rises above $3,022 (per ounce) after three consecutive losses (on COMEX)," Kedia Advisory said in a note. "Trump's tariff pronouncements, including potential levies on automobiles and Venezuelan oil, heightened market anxiety," Kotak Securities said in a report.

US President Donald Trump announced on Monday that the US would impose secondary tariff on Venezuela for numerous reasons and any country that buys oil or gas from Venezuela would pay a 25% tariff on any trades made with the US. "All documentation will be signed and registered, and the tariff will take place on April 2nd, 2025, Liberation Day in America," Trump said in a Truth Social post.

Trump also said automobile tariffs were coming soon, even as he indicated that not all of his threatened levies would be imposed on Apr. 2 and some countries might get breaks. At the White House, Trump told reporters not all new tariffs would be announced on Apr. 2, and that he might give "a lot of countries" breaks on tariffs, but provided no details.

Kotak Securities said gold's safe-haven appeal strengthened, contributing to a 15% year-to-date rally, following a robust 2024. "Gold's performance remains tied to trade dynamics, inflation signals, and evolving geopolitical landscapes, reflecting its role as a hedge against global uncertainties."

SILVER contracts rose on the MCX and COMEX, tracking a rise in gold contracts. At 1738 IST, the most-active May silver contract on the MCX was up 0.4% at INR 98,669 per kilogram. The same-month contract on the COMEX was 0.5% higher at $33.94 per ounce.

For gauging the US Federal Reserve's policy, investors await US PCE data on Friday and GDP data on Thursday.

Outlook for the rest of the session:

--MCX gold seen at INR 87,300–INR 88,200 per 10 gm

--COMEX gold seen at $3,000–$3,045 an ounce

--MCX silver seen at INR 97,600-INR 100,000 per kg

--COMEX silver seen at $33-$34 an ounce

End

US$1 = INR 85.76

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

Edited by Avishek Dutta

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