Gold Rebounds Rs 13,000 From Recent Low, Silver Rs 38k
In the Delhi spot market, the life-time high of gold was Rs 1,83,000 per 10 gm, touched on January 29
Chennai: After a 17 per cent fall, gold prices have reclaimed $5000 levels in the international market. In the domestic spot market, gold rebounded by over Rs 13,000 per 10 gm and silver by Rs 38,000 per kg.
On January 29, gold had surged nearly 28 per cent, marking only the second such monthly gain in the last 100 years, the previous instance being January 1980. Silver rallied nearly 70 per cent, the strongest monthly performance in its recorded history.
After delivering one of the strongest rallies in modern commodity history, precious metals entered a sharp corrective phase. Gold prices were at an all-time high near $5,600 per ounce, and silver at $125 on Jan 29. After a rout on January 30, gold prices plunged to a low of $4,630.59 an ounce by Feb 2, correcting 17 per cent. Silver too lost 38.5 per cent in these days while dropping to $76.81 an ounce.
However, on Wednesday, gold rebounded to $5090 and silver retraced $90.35 – making gains of 9.9 per cent and 17.6 per cent respectively from their recent lows.
In the Delhi spot market, the life-time high of gold was Rs 1,83,000 per 10 gm, touched on January 29. The fall in the subsequent days took gold prices to Rs 1,52,700 by Feb 2 – a drop of 16.5 per cent in a matter of four days. By Wednesday, gold prices rebounded to Rs 1.65 lakh in the spot market, gaining back 8.55 per cent from the recent lows.
Similarly, silver prices which had touched a record high of Rs 4.05 lakh per kg on January 29, fell 36 per cent the subsequent sessions to Rs 2.60 lakh by February 2. On Wednesday prices rebounded to Rs 2.98 lakh, gaining back 14.6 per cent.
“Gold climbed back above the $5,000 per ounce mark, extending gains after a historic rebound driven by dip buying following a sharp correction earlier in the week. Safe-haven demand was reinforced by rising geopolitical tensions after US forces downed an Iranian drone, even as diplomatic talks remain scheduled,” said Kedia Commodities.
On the policy front, expectations for aggressive Federal Reserve rate cuts were softened after Kevin Warsh was nominated as Fed chair, though markets still anticipate two cuts this year. Meanwhile, delayed US labour data due to the partial government shutdown and ongoing budget votes in Congress added to uncertainty, supporting demand for defensive assets.
For silver, underlying fundamentals, including a persistent supply deficit and steady industrial demand, continued to underpin prices, even as speculative excesses from January’s rally unwound after a sharp shift in sentiment.