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Informist, Friday, Sept. 5, 2025

By Ashutosh Pati

MUMBAI – Futures contract of gold on the Multi Commodity Exchange of India rose Friday because of a weak rupee. On the COMEX, gold contracts were steady ahead of the release of US non-farm payrolls data later in the day, which may give more cues on rate cuts by US Federal Open Market Committee.

At 1637 IST, the most-active December GOLD contract on the COMEX was steady at $3,608.2 per ounce. The most-active October gold contract on the MCX was 0.3% higher at INR 106,779 per 10 grams. "Investors now await the pivotal US payrolls report, which is expected to confirm the weakest stretch of job growth since the pandemic," Kotak Securities said in a report. "Lower US yields continue to support demand for non-yielding bullion, while safe-haven flows remain strong amid economic and geopolitical uncertainties," the report said.

On the domestic exchange, gold prices rose, after closing lower in the previous session, because of a sharp fall in the rupee against the dollar. The rupee ended at a record closing low of 88.2650 against the dollar. When the rupee depreciates against the dollar, prices of gold in the domestic market adjust as the precious metal is priced in rupees.

Gold prices finally broke out of the range-bound movement in the last two months and hit multiple record highs on both the domestic and international markets this week on rising bets of an interest rate cut by the US FOMC this month. "The latest leg higher reflects a potent mix of renewed rate cut expectations, mounting concerns over Federal Reserve's independence, and a fragmenting world order that is reshaping flows across safe-haven assets," Ole Hansen, head of commodity strategy at Saxo Bank, said in a note.

Moreover, concerns about governance in the US have added a premium to gold in recent weeks. "Treasury Secretary Scott Bessent will soon begin the process of finding the next Fed chair, a process that follows President Trump's attempt to remove Governor Lisa Cook. If successful, it could hand him a majority on the FOMC and the ability to reshape the US central bank in pursuit of lower interest rates," Hansen said.

SILVER contracts rose on the MCX while they were steady on the COMEX. At 1650 IST, the most-active September silver contract on the MCX was up 0.5% at INR 123,267 per kilogram. The same-month contract on COMEX was steady at $41.38 per ounce.

Outlook for the rest of the session:

--MCX gold seen at INR 103,257–INR 106,419 per 10 grams

--COMEX gold seen at $3,570.0–$3,645.0 an ounce

--MCX silver seen at INR 120,969-INR 127,171 per kg

--COMEX silver seen at $40.90-$41.80 an ounce

End

US$1 = INR 88.26

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

Edited by Nishant Maher

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