Gold Dips While Silver Rises on Easing Fed Hike Bets
Gold and silver prices showed mixed movements on the Multi Commodity Exchange (MCX) on Monday, influenced by recent weak US economic data. The data reduced expectations of a US Federal Reserve rate hike in October, boosting the appeal of non-yielding assets like gold and silver. MCX silver futures for December 2026 delivery rose Rs 1,025 to Rs 2,26,902 per kg, while gold futures for the same delivery fell Rs 1,400 to Rs 1,49,050 per 10 grams.
US job growth slowed more than expected in September, and nonfarm payrolls for the previous two months were revised sharply lower. This shift led markets to price in a 22% probability of a Fed rate hike in October, down from 64% a week earlier. The probability of a December rate increase remains at 87%, according to the CME FedWatch Tool. The US central bank had raised its benchmark overnight interest rate by 25 basis points to a range of 3.75%-4.00% in its last meeting.
In geopolitical developments, Yemen's Saudi-backed government launched a major military campaign to retake areas controlled by the Iran-backed Houthis. This development, along with higher crude exports from the Middle East and the release of oil stocks by G7 nations, contributed to a slip in oil prices despite concerns over potential damage to Gulf oil infrastructure.
Internationally, spot gold rose 0.4% to $4,158.17 per ounce, while US gold futures for December delivery gained 0.6% to $4,186.40. Among other precious metals, spot silver rose 1.7% to $61.40 per ounce, platinum gained 0.6% to $1,708.48, and palladium rose 0.6% to $1,175.04.
Manoj Kumar Jain of Prithvi Finmart advised avoiding fresh positions in gold and silver amid the long weekend and uncertainty surrounding US-Iran peace talks. He noted that gold is holding its support level of $4,110 per troy ounce, while silver is holding support at $59.10 per troy ounce. Gold prices could show further strength only after crossing and sustaining above $4,255, while silver needs to cross and sustain above $62.40.