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Informist, Thursday, Jun. 5, 2025

By Ashutosh Pati

MUMBAI – Futures contracts of gold were steady on the Multi Commodity Exchange of India and the COMEX Thursday as market participants are waiting for the US non-farm employment data due Friday for further cues about the interest rate trajectory in the country.

At 1843 IST, the most-active August GOLD contract on the COMEX was steady at $3,399 per ounce. The most-active August gold contract on the MCX was steady at INR 98,598 per 10 grams.

Earlier in the day, gold prices surged to a four-week high of $3,427.7 per ounce on the COMEX and a six-week high of INR 99,214 per 10 grams on the MCX, as weaker-than-expected economic data from the US raised expectations of interest rate cuts by the US Federal Reserve. Lower interest rates reduce borrowing costs, increasing liquidity in the market and making the non-yielding precious metal more appealing to investors.

"A downturn in US services and slower job growth prompted traders to anticipate monetary easing, which typically benefits non-yielding gold. Simultaneously, escalating trade tensions between the US, China, and the EU, exemplified by increased tariffs and strained diplomatic rhetoric, bolstered gold's safe-haven appeal," Kotak Securities said in a report. Meanwhile, the European Central Bank lowered its benchmark interest rates by 25 basis points. The lower rates will come into effect from Jun. 11, the central bank said in a press release.

SILVER prices rose to a record high of INR 105,484 per kg on the MCX earlier Thursday, as prices rose on the COMEX to a 13-year high of $36.36 per ounce due to short-covering. "This rally (in silver prices) is underpinned by a combination of weak US economic indicators, rising geopolitical tensions, a softening dollar, and robust industrial demand from sectors like electric vehicles and solar energy," Kedia Advisory said in a note.

There is also a sharp decline in the gold-silver ratio from 107 to 95, suggesting silver is increasingly favoured over gold by investors seeking value and growth potential, the brokerage said. At 1901 IST, the most-active July silver contract on the MCX was up 3.6% at INR 105,083 per kg. The same-month contract on COMEX was 4.3% higher at $36.30 per ounce.  

Outlook for the rest of the session:

--MCX gold seen at INR 97,143–INR 100,373 per 10 grams

--COMEX gold seen at $3,313.0–$3,472.2 an ounce

--MCX silver seen at INR 101,249-INR 106,893 per kg

--COMEX silver seen at $34.32-$36.82 an ounce

End

US$1 = INR 85.79

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

Edited by Nishant Maher

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