Both precious metals—gold and silver—remained higher during Monday’s session, as the recent sharp correction appeared to have triggered value buying, while softness in the US dollar also aided sentiment.
In addition, the election victory of Japan’s conservatives, who are pushing for higher fiscal spending, and a Bloomberg report stating that China is urging local banks to scale back their holdings of US government debt, were both seen as supporting demand for safe-haven assets.
Meanwhile, data released over the weekend showed that the Chinese central bank extended its gold purchases for a 15th consecutive month, underscoring resilient official demand, a key driver of the extended bull run that preceded the recent rout.
Tracking gold’s move on the day, the April futures contract on Comex rebounded by $90 per ounce to reclaim the $5,000 mark, rising to the day’s high of $5,069 per troy ounce and extending its winning streak to a second straight session.
Silver prices regain strength
Silver prices, which have a dual role as both a precious and an industrial metal, also regained strength, with the March silver contract on Comex surging $5.23 per ounce to an intraday high of $82.
Precious metals had been on a record-breaking ascent, driven by heightened geopolitical risks, the debasement trade, and concerns over the Federal Reserve’s independence.
A wave of speculative buying added fuel to the rally before gold and silver crashed at the end of last month. US Treasury Secretary Scott Bessant cited “unruly” trading in China as one of the reasons behind last week’s sharp price swings, Bloomberg reported.
The report also said that despite a week of choppy trading following the historic reversal, banks and asset managers including Deutsche Bank AG, Goldman Sachs Group Inc., and Pictet Asset Management have backed a recovery in bullion, citing long-term demand drivers such as diversification away from US assets, policy uncertainty, and elevated central-bank buying.
According to the report, Chinese regulators have advised financial institutions to rein in their holdings of US Treasuries, citing concerns over concentration risks and market volatility.
MCX gold jumps over ₹₹3,000 per 10g; silver marches towards ₹2.70 lakh
In the domestic market, the April futures contract of gold on MCX crossed the ₹1.55 lakh mark, extending gains for the second straight session and ₹3,049 per 10 grams to an intraday high of ₹1,58,500″>surging ₹3,049 per 10 grams to an intraday high of ₹1,58,500.
Meanwhile, the March silver futures contract opened higher at ₹2,59,887 per kilogram and continued its upward momentum to hit the day’s high of ₹2,68,885—up ₹15,000 from Friday’s close of ₹2,49,892.
(With inputs from Bloomberg)
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