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Informist, Thursday, Sept. 25, 2025

 

By Ashutosh Pati

 

MUMBAI – Futures contracts of silver on the Multi Commodity Exchange of India rose to record highs Thursday, tracking a rise in contracts on COMEX, where prices are at 14-year highs. The surge in silver prices comes amid expectations of more interest rate cuts by the US Federal Reserve, firm industrial demand for the metal, and soaring gold prices.

 

At 1818 IST, the most-active December SILVER contract on the MCX was up 1.6% at INR 136,155 per kilogram, after touching an all-time high of INR 137,530 per kg. The same-month contract on COMEX was up 1.6% at $44.91 per ounce.

 

Silver has outperformed even GOLD this year in percentage terms, surging 50%, Ole Hansen, head of commodity strategy at Saxo Bank, said in a note. "Its dual identity as both a monetary and industrial metal has worked to its advantage," Hansen said. "On one hand, silver benefits as a high-beta expression of gold's store-of-value appeal. On the other, structural demand growth from photovoltaics and electrification provides a more tangible narrative that helps anchor allocations."

 

Tuesday, Fed Chair Jerome Powell struck a cautious tone on further monetary policy easing. Powell said the central bank needs to continue balancing the competing risks of high inflation and a weakening job market at the upcoming meetings of the US Federal Open Market Committee, even as his colleagues staked out arguments on both sides of the policy divide. Newly appointed Fed Governor Stephen Miran said Monday the Fed is misreading how tight it has set monetary policy and will put the job market at risk without aggressive rate cuts, SMC Research said in a report. He said the appropriate Fed funds rate should be in the 2.0-2.5% range.

 

According to the CME FedWatch tool, 90% of traders are pricing in a 25-basis-point rate cut in October while 10% anticipate the rates remaining unchanged at 4.00-4.25%. Lower interest rates increase the appeal of non-interest-yielding precious metals.

 

Gold contracts on the MCX and COMEX were steady Thursday. At 1821 IST, the most-active October gold contract on the MCX was steady at INR 112,516 per 10 grams and the most-active December gold contract on COMEX was steady at $3,769.1 per ounce. Gold prices have surged around 44% this year. "The speed of the move underscores how shallow any corrections have been in recent weeks and months as dips continue to be met with fresh buying interest, a pattern consistent with broader macro support rather than speculative froth alone," Hansen added in his note.

 

Market participants are now waiting for the US personal consumption expenditures data, due Friday, for further cues on potential rate cuts by the Fed later this year.

 

Outlook for the rest of the session:

--MCX Oct gold seen at INR 111,800–INR 114,200 per 10 grams

--COMEX Dec gold seen at $3,740.0–$3,820.0 an ounce

--MCX Dec silver seen at INR 135,600-INR 139,000 per kg

--COMEX Dec silver seen at $44.60-$45.50 an ounce

 

End

 

US$1 = INR 88.66

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

 

Edited by Rajeev Pai

 

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