Gold, Silver Poised for Further Gains on Inflation Fears

Gold and silver prices are expected to continue their upward trend in the coming week due to inflation data from major economies and developments on efforts to end hostilities in West Asia. Investors will closely monitor inflation numbers from the US, Germany, Japan, and India, as well as upcoming Chinese economic data for industrial metals.

According to Pranav Mer, Senior Vice President of EBG - Commodity & Currency Research at JM Financial Services Ltd, gold and silver momentum looks positive and are expected to trade with a positive bias. He predicts that gold will move up towards Rs 1.57 lakh per 10 grams and silver will reach Rs 2.80 lakh per kg in the short term.

The domestic market has also seen a strong rally, with gold futures for October delivery climbing by nearly 6% to close at Rs 1.51 lakh per 10 grams. Silver futures for the September contract surged by over 7% to settle at Rs 2.31 lakh per kilogram on the Multi Commodity Exchange.

Jateen Trivedi, VP Research Analyst at LKP Securities, attributed gold's strong rally this week to weaker-than-expected US labour market data, which revived expectations of a more accommodative monetary policy from the Federal Reserve. The weaker dollar also encouraged fresh buying in precious metals, allowing gold to post one of its strongest weekly gains in recent months.