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Informist, Monday, Aug. 11, 2025

By Ashutosh Pati

MUMBAI – Futures contracts of gold on the Multi Commodity Exchange of India and the COMEX plunged Monday as traders await clarifications from the White House about tariffs on the precious metal. Gold prices had surged in the previous session after the Financial Times reported that the US was planning to impose tariffs on imports of one-kilo and 100-ounce gold bars.

However, prices of the precious metal pared gains after the US administration termed these reports as "misinformation". The White House later announced that it plans to issue an executive order on the same.

"Market participants note that until policy direction is confirmed, uncertainty over bullion flows and US futures market stability will persist," Kotak Securities said in a report. This "contrasts with April's exemption of gold from tariffs, underscoring policy volatility," the report added. At 1642 IST, the most-active December GOLD contract on the COMEX was 2.3% lower at $3,412.4 per ounce. The most-active October gold contract on the MCX was at INR 100,459 per 10 grams, down 1.3% from the previous close.

"After a sharp rise in the premium for gold futures in New York over London spot gold prices, levels have since eased back," Dow Jones quoted analysts at UBS as saying in a note. "Still, until there is an explicit confirmation that gold bars are tariff exempt--as suggested in April--markets will remain nervous," the analysts added.

Gold prices had risen around 3% last week due to heightened safe-haven demand after US President Donald Trump announced fresh tariffs. Rising bets of an interest rate cut by the US Federal Open Market Committee after weaker-than-expected economic data and concern over the independence of the US Fed had also supported the bullish sentiment. The CME's FedWatch tool now shows 87% chances of a rate cut by the US FOMC in September, against 57% a month ago. Lower interest rates make the non-interest-bearing precious metal more attractive to investors.

Market participants are now waiting for the US consumer price index data due later in the day for further cues about the interest rate trajectory in the country. They will also follow the speech of US FOMC member Thomas Barkin later in the day.

SILVER contracts fell on the MCX and the COMEX, tracking losses in gold and industrial metals. At 1708 IST, the most-active September silver contract on the MCX was 1.3% lower at INR 113,401 per kg. The same-month contract on COMEX was down 1.8% at $37.84 per ounce.

Outlook for the rest of the session:

--MCX gold seen at INR 98,936–INR 102,054 per 10 grams

--COMEX gold seen at $3,370.0–$3,430.0 an ounce

--MCX silver seen at INR 111,088-INR 116,154 per kg

--COMEX silver seen at $36.99-$38.87 an ounce

End

US$1 = INR 87.66

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

Edited by Saji George Titus

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