On the auspicious occasion of Makar Sankranti, the morning of January 14 saw a substantial increase in the prices of both gold and silver across the country. This surge is a direct reflection of heightened global uncertainty, a renewed demand for safe-haven assets, and mounting expectations that the US Federal Reserve may be compelled to implement further interest rate cuts, while investors are increasingly turning to precious metals as a hedge against economic and political instability, driving up their market value.
Current Gold Rates Across Major Cities
The price of 24-carat gold in Delhi has climbed to ₹142690 per 10 grams, with 22-carat gold trading at ₹130810 per 10 grams. In major metropolitan areas such as Mumbai, Chennai, and Kolkata, 24-carat gold is priced at ₹142540 per 10 grams, while 22-carat gold stands at ₹130660 per 10 grams. Ahmedabad and Bhopal have reported 24-carat gold prices at ₹142590 per 10 grams. Similarly, in Pune and Bengaluru, 24-carat gold is available for ₹142540 per 10 grams, and 22-carat gold for ₹130660 per 10 grams. Jaipur, Lucknow, and Chandigarh mirror Delhi's rates, with 24-carat gold at ₹142690 per 10 grams and 22-carat gold at ₹130810 per 10 grams. Hyderabad's rates are ₹142540 for 24-carat and ₹130710 for 22-carat gold per 10 grams. Globally, the spot price of gold has reached $4,586. 49 per ounce, underscoring the metal's strong performance in international markets.
Silver Prices Witness Significant Jump
Mirroring the trend in gold, silver prices have also experienced a sharp upward movement. On the morning of January 14, the price of silver surged to ₹275100 per kilogram. In international markets, the spot price of silver has hit a record level of $85. 64 per ounce. This substantial increase in silver prices is largely driven by a combination of industrial demand and its growing appeal as a safe-haven asset, particularly during periods of economic and geopolitical flux.
Global Uncertainty Fuels Safe-Haven Demand
A primary catalyst for the current rally in gold and silver prices is the pervasive global uncertainty. Amidst a backdrop of economic and political instability worldwide, investors are increasingly seeking refuge in assets traditionally considered safe havens. Gold and silver have historically served as reliable stores of value during times of market volatility and geopolitical tensions, offering a hedge against inflation and currency devaluation. The current complex geopolitical landscape and lingering economic concerns have Notably amplified this demand, leading to the observed price appreciation.
Impact of Federal Reserve's Monetary Policy
Another significant factor contributing to the upward trajectory of gold and silver prices is the mounting expectation that the US Federal Reserve will be compelled to further cut interest rates, while lower interest rates typically diminish the appeal of yield-bearing assets, making non-yielding assets like gold more attractive to investors. This scenario reduces the opportunity cost of holding gold. On top of that, the initiation of a criminal investigation by the US Attorney Office against Fed Chairman Jerome Powell, coupled with the escalating feud between President Trump and Powell, has adversely affected investor sentiment, while concerns regarding the independence of the Federal Reserve have also resurfaced, adding to market uncertainty and bolstering gold's appeal as a safe store of value.
Escalating Geopolitical Tensions
Geopolitical concerns have intensified, playing a crucial role in the current price surge. The growing unrest in Iran, alongside the ongoing Russia-Ukraine conflict, has heightened global anxieties. US President Donald Trump's decision to impose a 25 percent tariff on countries conducting business with Iran, combined with his contemplation of military options against Iran following anti-government protests, has Notably escalated tensions in the Middle East, while these developments contribute to a volatile global environment, prompting investors to seek the stability offered by precious metals.
Broader International Disputes
Adding to the global instability, previous statements by President Trump hinting at the possibility of the US purchasing or seizing Greenland had drawn a stern warning from Denmark, which affirmed its readiness to use military force to defend Greenland if necessary. Prior to this, the US had attacked Venezuela, leading to the capture of its President Nicolas Maduro and his wife. These incidents collectively underscore a period of heightened international political instability and the potential for conflict. Such a climate invariably drives investors towards traditional safe-haven assets like gold and silver, reflecting a market where geopolitical events directly influence the valuation of precious metals.
