Gold prices soar on US-China tariff war, cross Rs 98,000 in India to set new high
Silver prices climb to Rs 99,400 per kg amid geopolitical uncertainty and absence of any constructive progress in tariff negotiations between the US and China
Gold prices touched an all-time high of Rs 98,100 per 10 grams in New Delhi on Wednesday (April 16) amid a global rush for the safe-haven asset triggered by an escalated trade war between the US and China.
The price went down slightly later, to close at Rs 97,500 in the national capital though it remained higher in cities such as Bengaluru (Rs 97,820), Hyderabad (Rs 97,760), Chennai (Rs 97,750), and Kolkata (Rs 97,645). On Thursday, the prices fell slightly more.
On Wednesday, the price of gold per 10 grams soared by Rs 1,650 to hit the all-time high. According to the All India Sarafa Association, the precious metal of 99.9 per cent purity had finished at Rs 96,450 per 10 grams on Tuesday.
23.56 pc rise so far this year
Gold prices logged the highest single-day gain since April 11 when the spot rates skyrocketed by Rs 6,250 per 10 grams — the record steepest single-day rise so far — in the local markets.
So far, this year, the yellow metal prices have risen by Rs 18,710 or 23.56 per cent.
Gold of 99.5 per cent purity also appreciated by Rs 1,650 to hit a fresh peak of Rs 97,650 per 10 grams against the previous close of Rs 96,000 per 10 grams.
Also read: Indian engineering exports to US to fall by $4-5 b due to Trump tariffs: EEPC
Silver prices soar too
Silver prices also climbed by Rs 1,900 to Rs 99,400 per kg on Wednesday. The white metal had closed at Rs 97,500 per kg on Tuesday.
On the Multi Commodity Exchange, gold futures for June delivery surged by Rs 1,984 or 2.12 per cent to touch a record high of Rs 95,435 per 10 grams.
“Gold showed a solid rally once again...as MCX gold hit landmark levels of Rs 95,000, while Comex gold surpassed USD 3,300, reflecting strong safe-haven demand,” Jateen Trivedi, VP Research Analyst of Commodity and Currency, LKP Securities, said.
Rally driven by geopolitical uncertainty
The rally was driven by geopolitical uncertainty and the absence of any constructive progress in tariff negotiations between the US and China. Until there is a concrete update indicating de-escalation, gold is likely to remain elevated, Trivedi added.
On the global front, spot gold rose to touch a record high of USD 3,318 per ounce. Later, it pared some gains to trade at USD 3,299.99 per ounce.
“Gold surged to a record high, driven by growing trade war concerns after the US government tightened export rules to China,” Kaynat Chainwala, AVP-Commodity Research, Kotak Securities, said.
US President Donald Trump has announced an investigation into whether tariffs are needed on critical minerals, further fuelling market anxiety. On Wednesday, the US administration further raised tariffs on most goods from China to 245 per cent.
Also read: Trade war escalates as Trump slaps 245 pc tariff on China
Eye on US central bank
According to Abans Financial Services’ Chief Executive Officer Chintan Mehta, gold prices hit record highs as the US dollar index slipped below the 100-mark, nearing three-year lows.
He said the upswing in gold is fuelled by rising expectations of a potential interest rate cut, with markets closely watching US Federal Reserve Chair Jerome Powell’s speech, which came later on Wednesday.
However, Powell in his speech said the Fed would wait for more data on the economy’s direction before changing interest rates. He cautioned that Trump’s tariff policies risked pushing inflation and employment further from the central bank’s goals.
Strong support for gold
“As the Federal Reserve navigates the twin challenges of supporting economic growth while managing tariff-driven inflation, the current macro environment continues to offer strong support for gold,” said Mehta.
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“Adding to the bullish momentum, major banks remain positive on gold’s outlook, citing continued inflows into gold-backed ETFs and sustained central bank buying,” he added.
Spot silver in the Asian market hours rose nearly 2 per cent to USD 32.86 per ounce.
(With agency inputs)