MUMBAI: The safe haven metals, gold and silver, which have rallied 53% and 60% respectively so far this year, soared to new records Tuesday. Concerns over a potential US government shutdown, the new tariffs, and expectations of further Federal Reserve rate cuts have fueled this rally. The strengthening dollar only added more fuel to the price fire.
In the international markets, these metals are heading for the best monthly close in as many as 14 years, having crossed $3895.22/ounce Monday on CME. In September alone, the yellow metal rallied 11%.
In the domestic futures market, December gold futures on the MCX climbed Rs 1,217, or 1.04% to reach Rs 1,17,561/10 grams Tuesday, while February 2026 contracts surged Rs 1,314, hitting a lifetime high of Rs 1,18,788/10 grams.
Silver, which has returned more than gold this year rallying close to 60% so far, followed a similar trend touching a new high on the MCX with December futures rising Rs 1,101, or 0.77%, to Rs 1,44,200/kg; and March 2026 contracts gaining Rs 1,127, or 0.78% reaching Rs 1,45,858/kg.
In the retail market, according to the Delhi Sarafa market rates, gold was trading at Rs 11,121/gram for 24K, Rs 10,195 for 22K, and Rs 8,343 for 18K, while the white metal was fetching Rs 161/gram or 161,000/kg.
The domestic rally mirrored the global markets which also hit lifetime new highs, with December gold futures jumping over 1% to $3,895.22/ounce (28.35 grams), while silver touched $47.41/ounce on the Chicago mercantile exchange overnight. However, both metals opened low in their Tuesday trade losing on average 50 bps down from Monday evening trade.
"Gold and silver extended their bullish momentum as safe-haven demand surged amid concerns over a potential US government shutdown, and additional tariff measures, coupled with expectations of further Fed rate cuts, are driving precious metals higher," Rahul Kalantri, a vice-president of commodities at Mehta Equities, said.
"Gold prices rose to a fresh record high of $3,895.22/ounce, heading for their biggest monthly gain in 14 years, as investors rushed to the safe-haven asset amid mounting concerns over a looming US government shutdown," said Jigar Trivedi, senior analyst at Reliance Securities.
Precious metal futures have gained over 11% in September, he added.
"If no agreement is reached, a shutdown would begin on Wednesday early morning, potentially delaying the release of key economic data, including the September nonfarm payrolls report," Trivedi added.
Meanwhile, investors continued flocking to gold ETFs. "Gold exchange-traded funds attracted $10.5 billion in September, lifting total inflows this year to about $50 billion, as investors piled into the safe-haven asset amid global economic and political uncertainty," said Renisha Chainani, head of research at Augmont.
The value of gold that the US holds in its reserves (held by the federal government and not by the central bank like in India) is inching towards the $1 trillion mark at the peak price.
The US holds 8,133.5 tonnes in reserves which surpassed the $990 billion mark on Monday when the metal crossed the $3895/ounce mark. The second biggest hauler of official reserves is Germany (3,350.2 tonnes), followed by Italy (2,451.8 tonnes), France (2,437 tonnes), Russia (2,332.7 tonnes), China (2,298.5 tonnes), Switzerland (1,039.9 tonnes) and at the 10th slot is India with 900 tonnes as of June end.