Gold, silver rally on weaker dollar and falling oil prices

Precious metals displayed strong momentum on the Multi Commodity Exchange as both gold and silver extended their rally into a third consecutive trading session. According to reports, gold prices increased Rs 757 to settle at Rs 1,49,250 per 10 grams, while silver advanced Rs 228 per kilogram to reach Rs 2,27,812. The three-day surge has been substantial, with gold accumulating gains of Rs 6,400 over 10 grams and silver climbing Rs 11,000 per kilogram during this period. The rally reflects percentage gains of 5.2% for gold and 4.4% for silver across the three-session window.

The upward momentum in precious metals was supported by multiple headwinds to the US dollar, including weakening performance and declining Treasury yields. Additionally, the broader commodity complex benefited from easing crude oil prices, which have been declining amid geopolitical developments. The announcement indicated that hopes surrounding a potential reopening of the Strait of Hormuz have contributed to the softer energy price environment. These dynamics—a weaker dollar, lower yields, and reduced oil volatility—typically create favorable conditions for precious metal investors, as they enhance the appeal of non-interest-bearing assets and reduce the opportunity cost of holding gold and silver. The confluence of these factors has generated optimism regarding further upside potential in the near term.

Source: Markets-Economic Times