Gold, silver rates today in uptrend on US Fed rate cut buzz, weak US dollar. Which precious metal to buy?

Gold, silver rate today: Gold and silver prices witnessed strong buying, which helped precious bullions to end higher after a gap of two weeks. Spot gold price finished at $2,507 per ounce after climbing to a new peak of $2,509.72 (3.13%). After ending above $2,500 per ounce, spot gold price registered a weekly gain of 3.13 percent. On the Multi Commodity Exchange (MCX), gold price finished at 71,395 per 10 gm, logging a weekly gain of 2.12 percent. However, the silver price rally outshined the yellow metal price raise as MCX silver rates finished with a weekly gain of 3.31 percent at ₹83,213 per kg. In contrast, it registered a 5.67 percent rise in the international market, ending at $29 per ounce.

According to commodity market experts, gold and silver rates are on an uptrend due to the US Fed rate cut buzz after Thursday’s robust US job data. They said that positive US job data signals the sound condition of the US economy, which triggered the interest rate cut speculations in the following US Fed meeting scheduled next week. Experts added that US Fed rate cut bets have put the US dollar under pressure, and the US dollar rates hit a six-month low last week. They said that the bull trend in the precious bullions may continue in the near term as the geopolitical tension in the Middle East also supports the precious metal price rally. However, investors might need clarification as to which metal would be better to maximise their return, as silver outshined gold last week.

Triggers for gold, silver rates

On reasons that are fueling gold and silver prices these days, Sugandha Sachdeva, Founder of SS WealthStreet, said, “Gold prices surged to a new record high last week, closing above the key $2,500 per ounce mark in the international market. This rally was driven by a weakening dollar index and growing expectations that the US Fed may soon lower borrowing costs. The key catalyst was the release of softer-than-expected inflation data from the US, with both the Producer Price Index (PPI) and Consumer Price Index (CPI) for July falling short of expectations, strengthening the case for a potential rate cut by the Fed in its September meeting.”

“Adding to the upward momentum were escalating geopolitical tensions in the Middle East, which have heightened safe-haven demand for gold. Additionally, demand for gold ETFs remained robust in North America and Europe throughout July,” said Sugandha.

Outlook for gold and silver

Expecting the uptrend to continue in bullion metals, Anuj Gupta, Head of Commodity & Currency at HDFC Securities, said, “The US Fed rate cut buzz is expected to boost gold and silver prices. However, a clear picture will come after US Fed Chairman Jerome Powell’s speech at the Jackson Hole Symposium.”

The HDFC Securities expert said that the MCX gold rate today has immediate support at ₹71,000, whereas crucial support is now placed at ₹70,500 per 10 gm. Spot gold price has immediate support at $2,480, whereas crucial support for the yellow metal is at $2,450 per ounce.

“The immediate target for the MCX gold rate today is ₹72,000 and ₹72,800, while in the international market, spot gold prices may touch 2,530 and $2,560 per ounce in the near term,” said Anuj Gupta.

On the outlook for silver prices, Anuj Gupta of HDFC Securities said, “The MCX silver rate today has immediate support at 81,000, whereas its crucial support is placed at ₹80,000 per kg. Spot silver has supports at $28 and $27 per ounce. The near-term targets of the MCX silver rate today are seen at 85,000 and ₹87,000 per kg.”

Gold vs silver: Which is better?

On why silver outshined gold price rally last week, Amit Goel, Co-Founder and Chief Global Strategist at Pace 360, said, “During correction in July and August this year, silver prices had slipped more than the yellow metal. This led to the gold-silver ratio in the international market at 90. Over the last year, it has been found that silver prices ascend more than gold if the gold-silver ratio is around 90, whereas gold outshines silver when the ratio is below 80.” At the end of last week, the gold-silver ratio was around 86.50 (2507/29).”

The Pace 360 expert said that silver’s risk-reward ratio is higher than gold’s, and hence, if one has a near-term perspective, one should invest in silver.

Disclaimer: The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.