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Informist, Monday, Oct. 20, 2025

 

By Reshma Ravi

 

MUMBAI – Futures contracts of gold rose on the Multi Commodity Exchange Monday, tracking gains on COMEX due to rising expectation of a rate cut by the US Federal Reserve later this month. Rising safe-haven demand due to the prolonged US government shutdown and rising geopolitical risk also supported gold prices. 

 

At 1756 IST, the most-active December GOLD contract on the MCX was 1.5% higher at INR 128,960 per 10 grams. The most-active December gold contract on COMEX was up 2% at $4,302.2 per ounce.

 

According to the CME FedWatch tool, 98.9% of traders are pricing in a 25-basis-point rate cut by the Fed this month. The rest expect rates to remain unchanged at 4.00-4.25%. Lower interest rates increase the appeal of the non-interest-yielding precious metals.

 

Ukrainian drones struck a major gas-processing plant in southern Russia run by state-owned Gazprom and the Novokuibyshevsk oil refinery in the Samara region near Orenburg. Rising geopolitical risk supports gold prices as the metal is seen as a safe-haven investment. Strong inflows into exchange-traded funds, along with buying by central banks, also supported gold prices.

 

However, easing concern about the trade spat between the US and China might cap further gains in gold, Ajay Kedia, director of Kedia Stocks and Commodities Research Pvt. Ltd., said. US President Donald Trump said extra tariffs on China were "not sustainable" and a fresh round of US-China trade talks is scheduled this week. "Earlier, Trump had threatened an additional 100% tariff by November, but his latest remark signalled a softer stance," Kedia said.

 

Market participants now await the US CPI data, due Friday. Most other economic data in the US have been delayed by the government shutdown. A poll by The Wall Street Journal forecast the country's CPI inflation to be 3.1% on year, up from 2.9% in August. Core inflation is expected to remain at 3.1%.

 

SILVER contracts fell on the MCX and rose on COMEX. Silver on MCX fell as investors continued to take profits after a historic rally to an all-time high of INR 170,415 per kg Friday. At 1801 IST, the most-active December silver contract on the MCX was down 0.1% at INR 156,331 per kilogram. The same-month contract on COMEX was 2% higher at $51.15 per ounce.

 

Outlook for the rest of the session:

--MCX gold seen at INR 124,600–INR 130,600 per 10 grams

--COMEX gold seen at $4,196–$4,312 an ounce

--MCX silver seen at INR 154,500–INR 157,500 per kg

--COMEX silver seen at $50.50–$51.70 an ounce

 

End

 

US$1 = INR 87.92

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

 

Edited by Rajeev Pai

 

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