MCX Gold prices surged to a new record high on Tuesday, February 11, as concerns over US President Donald Trump’s latest tariff policies fueled a rise in the yellow metal. The April 4 contracts for MCX Gold reached ₹86,360 per 10 grams during the morning session, before stabilizing at ₹85,923 per 10 grams, marking a 0.12% increase around 11:35 AM.
International gold prices also hit significant milestones, with Comex Gold surpassing $2,900 for the first time, driven by safe-haven demand amidst escalating trade war concerns. Comex Gold hit a record high of $2,968.50.
Trump’s decision on Monday to impose a 25% tariff on steel and aluminum imports sparked fears of a potential trade war, pushing investors to flock to gold. Additionally, geopolitical instability and aggressive central bank buying have helped support gold’s recent rally.
“Gold prices have soared to new heights as investors seek safety following President Trump’s new tariff impositions. The latest threats have triggered another gold rush, with concerns over trade wars, inflation, and global growth uncertainty pushing prices to new records,” said Manav Modi, Analyst at Motilal Oswal Financial Services.
Modi highlighted that Trump’s tariffs have already sparked eight record-highs for gold this year alone, underscoring global economic uncertainties. The rupee’s weakening against the dollar and a subdued stock market environment have further boosted gold prices.
What Should Investors Do?
Investor attention is now turning to upcoming macroeconomic data, including the US Consumer Price Index (CPI) and Producer Price Index (PPI) reports. Analysts suggest that weaker-than-expected CPI and PPI figures could heighten expectations of a rate cut by the US Federal Reserve, which would likely weaken the dollar and push gold prices higher.
However, hotter-than-expected inflation data could strengthen the dollar and raise bond yields, potentially putting downward pressure on gold prices. Despite this, persistent concerns over trade wars, central bank buying, and retail investor demand could continue to support the precious metal.
Anuj Gupta, Head of Commodities and Currency Products at HDFC Securities, forecasts that gold prices will maintain their upward trend, with MCX Gold potentially surpassing the ₹87,000 mark. Gupta also advised investors who purchased gold around Diwali 2024 to consider booking partial profits.
Rahul Kalantri, Vice President of Commodities at Mehta Equities, expects gold prices to reach $3,000 by the end of February, but cautioned that the market is currently in the overbought zone and may experience volatility in the near term. Kalantri also projected that MCX Gold could test ₹88,000 soon.
“Short-term traders may consider booking profits at current levels, while long-term investors should monitor the USD-INR exchange rate and the dollar index for further market cues,” Kalantri added.
Technical Outlook
According to Manoj Kumar Jain of Prithvifinmart Commodity Research, gold has support at $2,914-$2,896 and resistance at $2,950-$2,974 per troy ounce. Silver, on the other hand, has support at $32.20-$31.88 and resistance at $32.74-$33.00 per troy ounce.
For MCX Gold, Jain noted support levels at ₹85,350-₹84,800, with resistance at ₹86,200-₹86,650. For silver, support is seen at ₹94,400-₹93,750, and resistance at ₹96,000-₹96,650.
As the gold market continues to be influenced by global economic conditions and President Trump’s trade policies, investors should remain vigilant and adapt to any changes in macroeconomic indicators and geopolitical developments.
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