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Informist, Friday, Dec. 12, 2025

 

By Ashutosh Pati

 

MUMBAI – Futures contracts of gold and silver on the Multi Commodity Exchange of India rose to fresh all-time highs Friday following a sharp fall in the rupee against the dollar. Gold contracts on the domestic bourse also rose tracking gains on COMEX after the US Federal Open Market Committee lowered its Fed funds target range by 25 basis points to 3.50-3.75% Thursday. Silver prices also drew support from a tight physical market, according to analysts.

 

At 1655 IST, the most-active February GOLD contract on the MCX was up 1.8% at INR 134,785 per 10 grams. The most-active February contract on COMEX was up 1.4% at $4,373.4 per ounce. Spot gold of 99.9% purity rose to INR 130,442-INR 130,523 per 10 grams in Mumbai Friday from INR 128,615-INR 128,836 per 10 grams Thursday.

 

The rupee ended at a record closing low against the dollar for the second consecutive trading day. After touching a record low of 90.5600 a dollar during the day, it settled at 90.4150, down from 90.3675 Thursday. When the rupee depreciates against the dollar, prices of gold and silver adjust in the domestic market as the precious metals are priced in rupees.

 

At 1656 IST, the most-active March SILVER contract on the MCX was up 1% at INR 200,892 per kg after hitting a record high of INR 201,388 per kg earlier in the day. The most-active March contract on COMEX was up 0.4% at $64.82 per ounce.

 

Silver prices drew additional support from a tight physical market. "According to Bloomberg, silver ETFs (exchange-traded funds) have recorded inflows of almost 130 million ounces this year, which corresponds to around 13% of the annual global silver supply," Barbara Lambrecht, commodity analyst at Commerzbank, said in a report. "This is significantly exacerbating the situation on the already undersupplied silver market. Therefore, the price increase appears to be fundamentally supported, but the extent of it undoubtedly calls for caution."

 

Kotak Securities said in a report that "a lower-rate environment and the Fed's renewed balance-sheet expansion with $40 billion in monthly T-bill purchases starting Friday added to the tailwinds. Silver also remained near record highs on strong industrial demand and tightening physical market conditions, underscoring the broader bullish momentum across precious metals."

 

Meanwhile, the US Federal Reserve's policy decision Thursday drew three dissents: Chicago Fed President Austan Goolsbee and Kansas City Fed President Jeffrey Schmid argued that the policy rate should be kept unchanged, while Fed Governor Stephen Miran again called for a larger 50-bp reduction, Informist had reported. At the post-policy press briefing, Fed Chair Jerome Powell said the Fed's interest rate policy was well positioned to respond to what lies ahead for the economy. He declined to give guidance on another interest rate cut in the near future.  End

 

US$1 = INR 90.41

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

 

Edited by Rajeev Pai

 

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