New Delhi: Gold prices increased sharply in futures trading on Tuesday as investors turned to the precious metal for safety amid global uncertainty. On the Multi Commodity Exchange (MCX), gold futures for April delivery climbed Rs 1,853, or 1.16 per cent, to Rs 1,62,152 per 10 grams. The rise was recorded with a business turnover of 7,355 lots.
The gain reflects renewed buying interest in gold, which is often considered a safe-haven investment during periods of global tension and currency weakness.
Weak Dollar Supports Gold
Analysts said the rise in gold prices was mainly supported by a weaker US dollar. The dollar index, which measures the strength of the US currency against six major global currencies, slipped 0.34 per cent to 98.84.
A weaker dollar typically makes gold cheaper for investors holding other currencies, which increases demand and pushes prices higher.
Global Markets Also See Strong Gains
Gold prices also surged in international markets. Comex gold futures for the April contract rose by USD 75.91, or 1.5 per cent, to USD 5,179.61 per ounce.
Market experts said global sentiment improved after comments from US President Donald Trump suggested that tensions with Iran could ease soon.
Jigar Trivedi, Senior Research Analyst at IndusInd Securities, said gold prices moved close to USD 5,180 per ounce as the dollar weakened after Trump indicated that the conflict in the Middle East might end shortly.
Middle East Developments Influence Markets
Trump recently attempted to calm markets amid ongoing military tensions with Iran, describing the operation as a “little excursion” and a “short-term” effort.
Earlier, traders were worried that a prolonged conflict in the region could push inflation higher, which would affect expectations about US interest rate cuts.
Investors Await Key Economic Data
According to analysts, market participants are now focusing on upcoming economic data from the United States. Important indicators such as the Consumer Price Index (CPI) and Personal Consumption Expenditures (PCE) inflation data are expected later this week.
These numbers will give investors more clarity about the US Federal Reserve’s future interest-rate decisions and could influence the near-term direction of gold prices.
Currently, markets are pricing in about 40 basis points of interest-rate cuts by the end of the year, lower than expectations of more than 55 basis points seen in late February.
