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Informist, Thursday, Sept. 25, 2025

 

By Rajesh Gajra and Ashutosh Pati

 

NEW DELHI/MUMBAI – The gold derivatives contracts on the Multi Commodity Exchange of India have seen a surge in turnover and traded lots this week as the prices of the precious metal continued to hit record highs almost every other day in September in both the international and domestic markets. 

 

The turnover of the 1 kg gold futures contract on the MCX touched an all-time high of INR 319.9 billion on Tuesday, surpassing the earlier high of INR 300.1 billion reached on Jul. 23, 2024. The number of lots traded in the contract touched a one-year high of 28,064 Tuesday, surpassing the earlier high of 27,117 lots on Apr. 23.

 

Tuesday, US COMEX gold futures hit an all-time high of $3,824.6 per ounce, and gold futures on MCX hit a record high of INR 114,179 per 10 grams. Currently, gold prices are up around 44% from their year-end level in 2024. Strong inflows into global gold exchange-traded funds have been boosting the prices, according to analysts.

 

The gold rally was triggered by recent weak economic data from the US and comments from US Federal Reserve Chair Jerome Powell at the Jackson Hole symposium last month, which raised expectations of the Fed lowering rates. As more investors are preferring gold due to expectations of further rate cuts by the US Federal Reserve, it has contributed to a rise in turnover, an official at a leading commodity derivatives market entity said.

 

The trading activity in 1 kg gold futures was elevated on Monday, with a turnover of INR 239.2 billion across 21,381 traded lots. Wednesday, however, the turnover in the contract fell to INR 197.2 billion across 17,312 traded lots. As of Wednesday, the average daily turnover in the contract in September was 58% higher than the previous month at INR 161.2 billion, while the average daily number of lots traded increased by 46%.

 

Further, the notional turnover in 1 kg gold options contract, which has the 1 kg gold futures as its underlying, was the second largest at INR 9.39 trillion Tuesday, not too far from the all-time high of INR 10.25 trillion reached on Aug. 29. The number of traded lots in the contract was the second highest in the last one year at 825,914 Tuesday.

 

The 1 kg gold options contract also saw elevated trading activity on Monday, with a notional turnover of INR 4.22 trillion and traded lots at 378,668. The notional turnover in this contract fell to INR 319.4 billion across 28,217 traded lots on Wednesday.

 

Uncertainties surrounding global trade and safe-haven demand have led to a rise in gold prices, according to Chirag Sheth, principal consultant for India at the global precious metals research consultancy Metals Focus. Sheth said the rally in gold prices is "not over yet".

 

There's a lot of volatility in gold right now, and participation in these contracts has increased due to hedging opportunities, according to Ajay Kedia, director at Kedia Advisory. Gold has already returned around 50% in the last year, reflecting geopolitical tensions, concerns about tariffs, and the independence of the US Federal Reserve.

 

"When you look at the turnover, it's a combination of the number of contracts traded and the price," Anindya Banerjee, senior vice president for commodity and currency at Kotak Securities, said. Since gold and silver prices have been touching record highs, everybody wants to trade in them, "so naturally, the traded volume is also going up," Banerjee said. The number of traded contracts has also jumped up, he added.

 

The mini 100 gm gold futures turnover also touched an all-time high of INR 136 billion on Tuesday on the MCX, crossing the earlier high of INR 129.7 billion touched on Apr. 22. The traded lots at 119,606 in this contract Tuesday were the third highest in the last year.

 

The mini 100 gm gold futures contract also saw a high turnover of INR 101.7 billion Monday across 91,169 traded lots. Wednesday, however, the turnover in this contract fell to INR 87.1 billion across 76,617 traded lots. Compared to the trailing month, the average daily turnover in this contract as of Wednesday in September was 40% higher at INR 70.7 billion, while the average daily number of lots traded increased by 28%.

 

In the mini 100 gm gold options contract, which has the mini 100 gm gold futures as its underlying, MCX recorded an all-time high notional turnover of INR 1.71 trillion on Tuesday. The previous all-time high was INR 1.05 trillion, reached on Monday. In terms of lots, this contract recorded 1.51 million traded lots Tuesday, the highest in the last year, and up from Monday's level of 941,945 traded lots.  End

 

US$1 = INR 88.66

 

Edited by Saji George Titus

 

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