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Informist, Wednesday, Mar. 19, 2025

 

--COMEX April gold contract hits fresh all-time high of $3,052.4 per oz 

--MCX April gold contract hits fresh all-time high of INR 89,014 per 10 gm 

 

MUMBAI - Gold contracts on the Multi Commodity Exchange of India and the COMEX scaled fresh lifetime highs Wednesday as rising geopolitical tensions in West Asia and concerns over a potential global trade war boosted the precious metal's safe-haven appeal.

 

At 1533 IST, the most-active April gold contract on the MCX was down 0.2% at INR 88,580 per 10 grams, after hitting a fresh lifetime high of INR 89,014 per 10 gm. The most=active April gold contract on COMEX was steady at $3,039.2 per ounce. The contract hit a fresh lifetime high of $3,052.4 per ounce earlier in the day. "These moves reflect market's increasing uncertainty regarding geopolitics, tariff implementation, and the path of monetary policy, which may keep gold prices high in the near term," analysts at Sucden Financial said in an e-mailed note.

 

Israel airstrikes pounded the Gaza strip on Tuesday killing over 400 people, breaking the ceasefire that was in effect since mid-January. Moreover, Israeli Prime Minister Benjamin Netanyahu hinted at more such attacks. "This is just the begining," Netanyahu said in a televised address.

 

Meanwhile, US President Donald Trump Monday reiterated the imposition of reciprocal tariffs from Apr. 2, under which the US plans to mirror the duties imposed by other nations. Trump threatened to impose additional penalties on the European Union if the bloc imposed counter-tariffs on US goods. Canada had said it would impose 25% reciprocal tariffs on steel products and other products from the US, and the EU will raise tariffs on American beef, poultry, bourbon, motorcycles, and several other products.  

 

"...tariffs have the potential to have a large impact over the next couple of years as businesses may possibly halt activities till they rebalance for the new regime and could potentially have a major impact on economic output in the developed world. In the face of such uncertainties, which transgress international borders, gold is likely to be the currency of choice even from current levels," Sandip Raichura, chief executive officer, Broking and Distribution and executive director - Prabhudas Lilladher Pvt. Ltd. said in an e-mailed note.

 

Investors will closely watch the US Federal Open Market Committee's policy meeting early Thursday. Market participants expect the FOMC to keep rates unchanged, however, any dovish signals on future monetary policy decisions may strengthen the yellow metal's momentum. Typically, gold has an inverse relationship with interest rates, with lower rates boosting the appeal of the non-interest-bearing precious metal.  End

 

US$1 = INR 86.44

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

 

Reported by Ashutosh Pati

Edited by Vandana Hingorani

 

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