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Informist, Thursday, Aug. 7, 2025

By Ashutosh Pati

MUMBAI – Futures contracts of gold rose to an all-time high on the Multi Commodity Exchange of India Thursday after the announcement of fresh tariffs by the US President Donald Trump. Gold contracts on COMEX were near two-week highs as rising geopolitical tensions and concern over the independence of the US Federal Reserve boosted the safe-haven appeal of the precious metal.

Gold contracts on the domestic exchange had touched an all-time high early Thursday and then broke it and surged to another fresh high later in the day. At 1733 IST, the most-active October GOLD contract on the MCX was 0.2% higher at INR 101,474 per 10 grams, after touching an intraday peak of INR 102,155 per 10 grams. The most-active December gold contract on COMEX was 0.5% higher at $3,422.9 per ounce.

Trump Wednesday said he will impose 100% tariff on imports of semiconductors and chips for companies not building in the US. The remarks came after Trump announced that tech giant Apple will invest another $100 billion in the US over the next four years on top of the $500 billion previously pledged. Moreover, Trump also announced that India will face an additional 25% tariffs for buying oil from Russia and he said he will clamp down on other countries importing Russian oil as well.

Rising bets of a rate cut by the US Federal Open Market Committee after a weaker-than-expected economic data and concern over the independence of the US Fed after the resignation of Fed Governor Adriana Kugler also added to the bullish sentiment. "Governor Adriana Kugler's resignation earlier this week could give President Trump the opportunity to appoint someone more in tune with his rate-cutting agenda," Ewa Manthey, commodities strategist at ING, said in a report. "Of course, he's no fan of Chair Powell, and his term ends next May. It's all adding to fears about the Fed's independence, all the time boosting the gold price," Manthey added.

The CME's FedWatch tool now shows 91% chances of a rate cut by the US FOMC in September, against 38% a week ago. Lower interest rates make the non-interest-bearing precious metal more attractive to investors. "...softer US economic data and clear signs of a cooling labor market have strengthened expectations of a Fed rate cut in September, with markets also pricing in a second cut by December," Kotak Securities said.

Meanwhile, gold purchases by global central banks saw a modest rise in June, with net purchases reaching 22 tonnes, according to the World Gold Council. In the first six months of 2025, global central banks have net purchased 123 tonnes of gold. "...we believe central banks will continue to add gold to their reserves given the still-uncertain economic environment and the drive to diversify away from the US dollar," Manthey said.

SILVER contracts rose on the MCX and the COMEX, tracking gains in gold prices. At 1750 IST, the most-active September silver contract on the MCX was 1.1% higher at INR 114,921 per kg. The same-month contract on COMEX was up 1.6% at $38.52 per ounce.

Outlook for the rest of the session:

--MCX gold seen at INR 100,194–INR 103,136 per 10 grams

--COMEX gold seen at $3,316.4–$3,433.2 an ounce

--MCX silver seen at INR 112,505-INR 117,437 per kg

--COMEX silver seen at $37.35-$39.21 an ounce

End

US$1 = INR 87.70

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

Edited by Akul Nishant Akhoury

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