Mumbai: Gold hovered near fresh record high while silver touched new peak on Wednesday, as softer US inflation data and elevated geopolitical tensions boosted safe haven demand among investors. MCX gold February futures rose 0.53 per cent to Rs 1,42,995 per 10 grams around 10.05 am, while MCX silver March futures climbed 4.53 per cent to Rs 2,87,640 per kg. US core Consumer Price Index (CPI) data for December showed a 0.2 per cent month‑on‑month surge and 2.6 per cent year‑on‑year rise, below forecasts and reinforcing market bets that the Federal Reserve will cut rates in 2026, driving gold prices higher.
Analyst said the softer inflation print, coupled with mixed US jobs data, will lead the Fed likely to hold in January but likely undertake two to three cuts through the year, supporting gold prices. "Ongoing geopolitical and economic uncertainties continued to fuel safe-haven demand. Civil unrest in Iran and rising geopolitical tensions further supported buying interest in precious metals.
Core CPI was below expectations of 0.3 per cent, and remained steady on year-on-year basis, reinforcing the view that underlying inflation pressures are easing," said Rahul Kalantri, VP Commodities, Mehta Equities Ltd. "Gold has support at Rs 1,39,550-Rs 1,37,310 while resistance at Rs 1,44,350-Rs 1,46,670. Silver has support at Rs 2,69,810 to Rs 2,54,170 zone while resistance at Rs 2,79,810 to Rs 2,84,470 zone," analyst said.
Market watchers also pointed rising geopolitical risks stemming from unrest in Iran and tensions involving Venezuela and Greenland as additional drivers of demand. Gold and silver prices are expected to remain volatile this week amid volatility in the dollar index, ahead of the US Supreme Court decision on tariffs, they added. Silver prices remain decisively above short and medium-term averages following a strong breakout, reflecting aggressive buyer dominance. The rally is being driven by a powerful mix of industrial demand in solar, EVs, AI, electronics and safe-haven flows, against the backdrop of tightening supply conditions, they added.
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