Gold prices in India surged to a record high of ₹90,000 per 10 grams on March 19, driven by weak U.S. inflation data and global economic uncertainties. Silver also reached an all-time high, crossing ₹1 lakh. The rise is attributed to increasing trade tensions between the U.S. and Europe, as well as expectations of Federal Reserve rate cuts. Market experts suggest a cautious approach to trading amid the volatility.
Gold prices in India reached an all-time high of ₹90,000 per 10 grams on March 19, reflecting growing investor concerns over global economic instability. Silver prices also surged past the ₹1 lakh mark. Analysts attribute this sharp rise to weak U.S. inflation data, heightened trade tensions between the U.S. and Europe, and speculation about potential Federal Reserve rate cuts.
Factors Driving Gold and Silver Prices
Intermarket volatility remains a key driver of the recent surge in precious metal prices. The Federal Reserve’s potential monetary policy adjustments and international trade conflicts have led to increased demand for safe-haven assets like gold and silver.
According to brokerage firm Motilal Oswal Financial Services (MOFSL), a significant drop in U.S. inflation data has reinforced market expectations that the Federal Reserve may cut interest rates in the near future. The U.S. inflation rate in February fell to 2.8%, lower than the expected 2.9%, prompting concerns about economic slowdown.
Additionally, escalating trade tensions have further contributed to price volatility. The U.S. president recently threatened tariffs of up to 200% on European alcoholic beverages, including wines and champagnes, in retaliation for the European Union’s 50% levy on American whiskey. This move follows previous disputes over tariffs on imported steel and aluminum.
Expert Insights on Trading Gold Amid Surging Prices
As investors look for safe investment options amid uncertainty, experts suggest maintaining a strategic approach to gold trading.
Sandip Raichura, CEO – Retail Broking and Distribution at PL Broking, stated, “Investors are shifting to gold as trade tensions continue to dominate market sentiment. The USD is at a critical juncture, and while a long-term decline is expected if the U.S. enters a recession, gold will likely remain well-supported in the short term.”
MOFSL noted that gold and silver prices could witness some consolidation after the sharp rally. “After a strong surge, both gold and silver might see short-term corrections, but the overall trend remains bullish. Investors should consider a buy-on-dips strategy for both metals,” the firm added.
Market analysts suggest that upcoming economic data releases, including U.S. retail sales figures, industrial production index, and housing market data, will play a crucial role in determining the next move for gold prices. The Federal Reserve’s stance on interest rate cuts will also be a major influencing factor in the near future.
For Indian investors, gold remains an attractive asset in times of uncertainty. However, analysts advise investors to monitor international developments closely and adopt a cautious approach when trading amid high price fluctuations.
