Gold and Silver Prices Surge After US Fed Chair's Dovish Speech; Dollar Retreats

Gold and silver prices surged to new highs following US Federal Reserve Chair Jerome Powell’s speech, causing the US dollar to retreat from a four-month high.

Gold and silver prices surged to new highs following US Fed Chair Jerome Powell’s speech, which signalled a dovish stance on interest rates. The US dollar retreated from a four-month high, further boosting precious metal prices.

On the Multi Commodity Exchange (MCX), gold reached a record high of ₹69,908 per 10 gm, while silver hit a lifetime high of ₹79,630 per kg. Gold futures for June 2024 on MCX opened at ₹69,868 and soared to an intraday peak of ₹69,908 per 10 gm. Similarly, silver futures for May expiry opened higher and reached an intraday high of ₹79,630 per kg, setting a new record on MCX.

Commodity market experts attribute the surge in gold and silver prices to Powell’s speech, which hinted at potential interest rate cuts in the upcoming US Fed meeting scheduled from April 30 to May 1, 2024. Additionally, the retreat of the US dollar index from its recent high also contributed to the bullish trend in bullion metal prices worldwide.

Anuj Gupta, Head of Commodity & Currency at HDFC Securities, emphasized the significance of Powell’s dovish stance on interest rates, leading to market expectations of a rate cut. He also noted the cooling of US dollar rates post-Powell’s speech.

Amit Goel, Co-Founder & Chief Global Strategist at Pace 360, highlighted additional factors driving the surge in gold and silver prices, including expected rate cuts by central banks globally, oversold market conditions, central bank buying (particularly by China), and geopolitical tensions in regions like Ukraine and the Middle East.

Looking ahead, analysts suggest that any dip in gold and silver prices should be viewed as a buying opportunity. In the international market, gold is trading in the $2,280 to $2,320 per ounce range, while silver is in the $26.50 to $27.50 per ounce range. On MCX, gold has immediate support at ₹69,000 and resistance at ₹80,200 per 10 gm, while silver ranges from ₹78,000 to ₹80,500 per kg. Investors are advised to monitor these levels for potential buying opportunities.