New Delhi: Gold and silver prices are likely to extend their gains next week as investors track inflation data from major economies, US Federal Reserve expectations and developments in West Asia, analysts said.
Bullion posted strong gains last week, supported by weaker-than-expected US labour market data and a softer dollar, which strengthened expectations of a more accommodative monetary policy stance from the Federal Reserve.
Domestic Rally
Gold futures for October delivery climbed ₹8,444, or nearly 6 per cent, during the week to close at ₹1.51 lakh per 10 grams.
Silver futures for September delivery jumped ₹14,268, or nearly 7 per cent, to settle at ₹2.31 lakh per kg on the Multi Commodity Exchange.
Pranav Mer, Senior Vice-President, EBG – Commodity & Currency Research at JM Financial Services, expects the positive momentum to continue.
He said gold and silver could move towards ₹1.57 lakh per 10 grams and ₹2.80 lakh per kg, respectively, in the short term.
Global Surge
International bullion prices recorded even sharper gains. Gold futures for December delivery surged $292.7, or 7 per cent, during the week to $4,399.7 an ounce.
Silver futures for September delivery soared $5.71, or nearly 10 per cent, to $63.50 an ounce.
Jateen Trivedi, VP Research Analyst, Commodity and Currency at LKP Securities, attributed the rally to weaker US labour data, which revived expectations of easier monetary policy.
Data Watch
Investors will closely monitor inflation figures from the US, Germany, Japan and India next week. Chinese economic data will also be important, particularly for silver because of its significant industrial use.
The direction of the US dollar and expectations surrounding the Federal Reserve are also expected to influence precious metal prices.
Geopolitical Risks
Developments in West Asia, particularly those involving the US and Iran, will remain another key trigger for bullion.
Any unexpected diplomatic breakthrough or escalation in military tensions could result in sharp price movements when trading resumes.
Analysts expect volatility to remain elevated, with inflation data, monetary policy expectations and geopolitical developments likely to determine whether bullion can sustain its recent rally.
