Gold Prices: 24K/10 Grams Gold At Rs 74,890, 1Kg Silver Rs 8,000 Away From Rs 1,00,000; Weekly Outlook Ahead

Gold prices witnessed a sharp surge during the week that ended on September 14, 2024, with MCX gold along with 24K, 22K, and 18K yellow metal prices touching new record highs. Even, silver prices shot up to break key resistance. Now, 1kg of silver price in India is just Rs 8,000 from hitting Rs 1,00,000. Investors are optimistic about a rate cut from the US Federal Reserve in its upcoming policy meeting later this week.

However, bets of large-size cuts such as 50 bps have dimmed, while the majority hope for a 25 bps cut from the Fed which is likely to boost non-yielding assets like gold against the US dollar in the overseas market. The dollar index has seen see-saw-like momentum last week.

Gold Prices In India: Currently, 24K gold prices in 10 grams are at an all-time high of Rs 74,890, while 22K and 18K of the same are at Rs 68,650 and Rs 56,170 respectively. Further, the most expensive gold to buy is at Rs 7,48,900 in 24K of 100 grams, while the cheapest gold is 1 gram in 18k priced at Rs 5,617. Noteworthily, the prices of 22K, 24K, and 18K recovered early losses of September due to strong upside last week. Now, overall gold is up by over 2.5% across carats in the current month so far.

Silver Prices In India: 1 Kg price of silver is at Rs 92,000, closing the gap towards Rs 1,00,000 gradually. Further, 100 grams and 10 grams of silver are at Rs 9,200 and Rs 920 respectively. Overall, in September 2024, prices of gold surged by nearly 6%.

MCX Gold, Silver Prices: At the commodity exchange, MCX gold futures with an October expiry, stood at Rs 73,510, while MCX silver with a December expiry ended last week at Rs 89,244.

Gold Prices Weekly Outlook:

SMC Global Securities in its WISE Money report said that Gold surged to a new record high in COMEX, while silver broke through the strong resistance level of $30. On MCX, gold crossed Rs. 73,200, and silver approached Rs. 88,000. Gains in the yellow metal came as investors remained convinced that the Fed will cut rates when it meets next week. After September, there are two more Fed meetings left in the year.

Further, the brokerage highlighted that gold prices reached a new all-time high in COMEX, driven by a weaker dollar and lower bond yields. The rally was bolstered by economic data that raised expectations for aggressive Federal Reserve rate cuts next week. U.S. initial jobless claims increased, surpassing previous averages and signalling a softening labour market, along with weak August payroll data.

Additionally, the brokerage added, U.S. producer prices rose slightly more than expected in August, largely due to higher service costs, though the broader inflation trend remains on an easing path. The year-over-year Final Demand PPI fell by 0.4 percentage points to 1.7%, below the Fed's 2% target and the consensus of 1.8%.

However, SMC's note also pointed out that core PPI-which excludes food, energy, and trade services-maintained a 0.3% monthly increase and rose to 3.3% year-over-year. According to the CME FedWatch tool, markets now see a 59% chance of a 25-basis-point rate cut and a 41% chance of a 50- 50-basis-point cut. Meanwhile, the European Central Bank (ECB) also cut interest rates by 25 basis points, as expected, signalling growing confidence in inflation's downward trajectory.

Moreover, SMC's note said, "Fed Chair Jerome Powell has indicated a potential rate-cutting cycle, with markets anticipating a rate reduction during the Federal Open Market Committee (FOMC) meeting on September 18."

During the trading week from September 16-20, SMC's said, on the Comex, gold has broken out of a long consolidation phase, and analysts expect prices to trade between $2,490 and $2,640. Silver is forecasted to trade between $28.90 and $32.40. On the MCX, gold may continue its bullish trend, with support around ₹70,900 and resistance at ₹74,400, while silver could trade between ₹84,800 and ₹90,000.