Gold Price Likely To Extend Gains; Silver May Ease This Week, Say Analysts

Investors' attention will turn to a string of key global macroeconomic data, including inflation figures from major economies, as well as the Personal Consumption Expenditures index, the gross-domestic-product growth, Purchasing Managers Index readings and jobless claims, which will provide fresh cues on the Fed's policy outlook, they said.

"The focus will be on the upcoming economic numbers from China - crucial from an industrial metals perspective. Among other developments, US President Donald Trump's speech at the World Economic Forum and the Supreme Court judgement on trade will be most important to watch," Pranav Mer, vice president of EBG - commodity and currency research at JM Financial Services Ltd, said.

On the Multi Commodity Exchange, the yellow metal futures climbed Rs 3,698, or 2.7%, over the past week. It had increased to hit a record of Rs 1,43,590 per 10 grams on Wednesday.

"Gold prices on the domestic market were up 2.7% for the week, partly supported by a weaker rupee against the dollar. Later, the yellow metal pared some gains on Friday amid profit-booking and long-liquidation, as the risk premium eased following the US president's softer tone on Iran, better-than-expected jobs data, and a firm dollar," Mer said.

In the international market, gold futures on the Comex gained $94.5, or 2.09%, last week. It had closed at $4,595.4 per ounce on Friday, after hitting a record of $4,650.50 per ounce earlier in the week.

"Gold prices rose by more than 2% over the week amid geopolitical risk coming out of Iran, driving strong investor interest in safe haven assets. Expectations of interest rate cuts by the US Fed, a weaker dollar, lower treasury yields and continued central bank buying remain supportive for the yellow metal," Prathamesh Mallya, DVP-research, non-agri commodities and currencies at Angel One, said.

Mallya projected that gold prices could move higher towards the Rs 1,46,000-per-10-gram mark on the MCX and around $4,750 per ounce level in the global markets in the coming week.

Meanwhile, silver rallied by nearly 14%, or Rs 35,037, during the week, on the MCX. It had surged to hit a record of Rs 2,92,960 per kilogram. On the global front, the white metal gained $9.2, or 11.6%, to close at $88.53 per ounce, after touching a lifetime high of $93.75 last week.

"Silver's parabolic rally continued as prices gained more than 11.5% for the week, as some profit-booking and consolidation were seen in the last couple of trading sessions, following reports that the Trump administration won't be levying tariffs on critical miners for now," Mer said.

Silver is expected to remain buoyant. However, its sharp rally could face a correction as it nears the $100-per-ounce mark.

"We expect a big corrective move either before or after the $100 is breached," he added.

On the outlook, Vijay Kuppa, CEO of InCred Money, said gold and silver continued to stay structurally positive, even as periods of volatility are likely in the near term.

"Central banks are adding gold to their reserves, while ETF inflows are absorbing a significant portion of supply. Geopolitical tensions and persistent macroeconomic uncertainty reinforce the role of holding precious metals as portfolio hedges," he said.

Kuppa added that silver's dual role as a precious and industrial metal, driven by demand from technology, renewable energy and electrification, continues to create a supportive long-term setup.

"After an extended rally, phases of consolidation and price corrections are normal. Short-term pullbacks do not necessarily change the broader trend and are often part of the price-discovery process," he said.