Gold and silver futures on the Multi Commodity Exchange (MCX) witnessed sharp buying interest on February 2, 2026, after India and the United States announced a major trade agreement that significantly reduces US tariffs on Indian exports. The development helped bullion prices recover strongly from last week's steep selloff, as investors reassessed risk sentiment.
MCX gold futures surged to reclaim levels above Rs 1.53 lakh per 10 grams, while MCX silver futures climbed close to the Rs 2.7 lakh per kg mark. On the day, gold futures were up more than 6%, while silver futures jumped over 14%, reflecting aggressive short-covering and fresh long positions.
Global Bullion Prices Support Recovery
The rally in domestic futures tracked firm global cues. Spot gold prices rose nearly 5%, while spot silver jumped over 11%, as investors questioned whether last week's sharp correction was structural or an overshoot driven by temporary factors such as margin hikes and position unwinding.
Hareesh V, Head of Commodity Research at Geojit Investments Limited, said gold and silver are showing early signs of stabilisation following last week's historic decline. "The drivers for bullion remain intact, suggesting the correction was largely due to short-term catalysts rather than a shift in long-term fundamentals," he said.
According to Hareesh, prices are now attempting a mild recovery as markets digest the combined impact of a stronger US dollar, recent margin hikes, and repositioning linked to the US Federal Reserve chair nomination.
Despite the rebound, analysts cautioned that trading conditions could remain choppy in the near term. Hareesh noted that a sustained recovery in bullion futures is likely to be gradual, while downside risks could resurface if prices slip below last week's lows, which now act as key technical support levels.
Tariff Cuts Boost Market Sentiment
Bullion sentiment improved after US President Donald Trump announced an immediate reduction in reciprocal tariffs on Indian goods to 18% from 25%, along with plans to eventually scrap an additional 25% punitive duty imposed in August last year. By mid-2025, cumulative US tariffs on Indian exports had risen to 50%, combining baseline, reciprocal and punitive levies.
Trump said the US aims to further reduce tariffs over time, potentially to zero, while India would move to cut its own tariffs and non-tariff barriers.
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