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Informist, Tuesday, Sept. 9, 2025

--COMEX Dec gold contract hits new record high of $3,694.9 per ounce 

--MCX Oct gold contract hits new record high of INR 109,000 per 10 gm 

MUMBAI – Futures contracts of gold on the Multi Commmodity Exchange of India hit fresh record highs, tracking a rise in gold prices on COMEX due to rising hope of a rate cut by the US Federal Reserve and a weak dollar. Safe-haven demand for the precious metal amid global economic uncertainties also supported prices.

At 0923 IST, the most active October gold contract on the MCX was up 0.3% at INR 108,857 per 10 grams, after touching a record high of INR 109,00 per 10 grams. The most active December gold contract on the COMEX was up 0.2% at $3,684.2 per ounce. Gold prices on COMEX rose to a new record high of $3,694.9 per ounce earlier in the day. 

"Falling US treasury yields and a weaker US dollar have created the perfect conditions for precious metals," Dow Jones quoted analysts at Sucden Financial as saying in a note. Prices were also supported by weakness in the labour market. "Continued labour market softness and expectations of ongoing Fed rate cuts into early 2026 could provide sustained support for bullion," Reuters quoted Peter Grant, vice-president and senior metals' strategist at Zaner Metals, as saying.

Data showed US jobs growth weakened sharply in August while the unemployment rate increased to 4.3%, signalling a soft labour market and raising rate cut bets. The US added 22,000 jobs in August, below the rise of 75,000 expected by economists, figures from the Labor Department showed Friday. 

The market is now pricing in an 88.4% chance of the Fed cutting interest rates by 25 basis points later this month, with an 11.6% probability of a 50-bps cut, according to CME's FedWatch tool. A low interest rate increases the appeal of the non-interest-yielding precious metal. 

At 0923 IST, the dollar index, which measures the strength of the greenback against a basket of six major currencies, was down nearly 0.03% at 97.41. A weak dollar makes dollar-denominated commodities such as gold less expensive for those holding other currencies, increasing demand for such metals.

Prices are also supported by a rise in safe-haven demand due to trade uncertainties, concerns over about the US Fed's independence, and lingering geopolitical tensions, analysts said.

Investors are now awaiting the US producer price data on Wednesday and the consumer prices print on Thursday for further clues into the Fed's policy path. "A potential short-term catalyst would be if US inflation data comes in below expectations this week, which could see the Fed dial up their dovish levels at their September meeting and could hasten gold's ambitions of hitting the $3,700 level," Reuters quoted KCM Trade Chief Market Analyst Tim Waterer as saying.  End

US$1 = INR 87.99

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

Reported by Shreya Shetty

Edited by Avishek Dutta

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