Gold, Silver Rally Expected on US Inflation & Fed Signals
By Market Desk
Gold and silver prices are set to rise, influenced by US inflation data and Federal Reserve signals from the Jackson Hole symposium. Potential profit-booking noted.
Gold and silver prices are projected to increase next week, primarily driven by forthcoming US inflation data and anticipated signals from the Federal Reserve’s Jackson Hole symposium. While a positive bias is expected, profit-booking could temper the rally at higher levels.
- On the domestic Multi Commodity Exchange (MCX), October gold futures gained 5.13%, closing at Rs 1.62 lakh per 10 grams.
- September silver futures surged 4.52%, settling at Rs 2.46 lakh per kilogram.
- Internationally, Comex December gold futures increased 5.5% to USD 4,680.6 per ounce.
- Comex September silver futures climbed nearly 7% to USD 69.53 per ounce in New York.
This domestic rally stemmed from renewed buying interest, coupled with softer bond yields and improved liquidity conditions. The sharp mid-week price movement was further fueled by liquidity measures from the US Treasury Department, specifically its plan to double down on buybacks of longer-dated bonds.
US Economic Data and Federal Reserve Outlook
Analysts are closely monitoring upcoming US inflation data, including Core Personal Consumption Expenditures (PCE) and GDP figures. Federal Reserve Chair Kevin Warsh’s keynote address at the Jackson Hole symposium, scheduled for August 27-29, is also a pivotal event for bullion traders.
- Forthcoming US inflation data: Core Personal Consumption Expenditures (PCE) and GDP figures.
- Federal Reserve Chair Kevin Warsh’s keynote address at the Jackson Hole symposium (August 27-29).
- Geopolitical developments in West Asia, including the US-Iran peace deal.
- Reopening of the Strait of Hormuz.
Despite the positive bias, market participants anticipate some profit-booking could occur at higher levels. This suggests a cautious approach as investors await the key economic releases and geopolitical clarity.
The confluence of US economic indicators, Federal Reserve commentary, and global geopolitical shifts will dictate bullion’s trajectory in the immediate term, maintaining a positive, yet monitored, outlook.