Gold, Silver Rally Set to Continue Amid Inflation Data and West Asia Tensions

Gold and silver prices are expected to extend their gains next week as investors track inflation data from major economies, US Federal Reserve expectations, and developments in West Asia. Analysts point out that bullion posted strong gains last week due to 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.

The domestic rally saw Gold futures for October delivery climb ₹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, with gold and silver potentially moving towards ₹1.57 lakh per 10 grams and ₹2.80 lakh per kg, respectively, in the short term.

International bullion prices recorded even sharper gains, with Gold futures for December delivery surging $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.