Gold and Silver Prices on Diwali: A Comprehensive Analysis
Gold prices remained higher in the domestic and international markets on Monday, with gold futures for December delivery rising 0.8% to Rs 1,28,556 per 10 grams on the Multi Commodity Exchange. Silver contracts were flat at Rs 1,55,518 per one kilogram.
Spot Market Prices
In the spot market, gold was quoted at Rs 1,31,425 on Diwali day, indicating a strong demand for the precious metal during the festive season. The spot market prices are influenced by various factors, including global market trends and currency fluctuations.
International Market Trends
On the international market, the yellow metal edged up, recouping after a steep drop last week from a record high, on President Donald Trump’s comments that alleviated US-China trade tensions and drove investors towards riskier assets. Bullion rose 1.5% to $4,272 on Comex.
Silver prices fell as much as 1.2% before trimming losses, after closing 4.3% lower Friday on signs that a squeeze in London stockpiles may be easing, Bloomberg reported.
Market Expectations
Local gold prices are expected to witness some consolidation and mild correction this week as the recent record-breaking rally looks overstretched and physical demand eases after the festive rush, analysts said. After hitting fresh highs in global and domestic markets, bullion may trade in a narrow range, with investors eyeing the US funding bill, key global data releases, and remarks from Federal Reserve officials ahead of the Oct. 28-29 policy meeting, they added.
Dhanteras Festival and Gold Sales
Indian consumers spent an estimated Rs 1 lakh crore during the Dhanteras festival this year, driven by robust gold and silver purchases despite sharp price increases, a leading traders’ body said on Saturday. The Confederation of All India Traders said gold and silver sales alone accounted for Rs 60,000 crore of the total, marking a 25% increase from last year, as shoppers flocked to bullion markets despite gold prices surging 60% year-on-year to cross Rs 1,30,000 per 10 grams.
Soaring gold prices led Indian buyers to choose coins and bars over jewellery during the Dhanteras, fuelled by hopes that the precious metal’s glittering rally would continue, industry officials told Reuters.
Conclusion
In conclusion, the gold and silver prices on Diwali have been influenced by various factors, including global market trends, currency fluctuations, and demand for the precious metals during the festive season. As the market expects some consolidation and mild correction, investors should keep a close eye on the US funding bill, key global data releases, and remarks from Federal Reserve officials.