MCX Gold reached an all-time high on Thursday, April 17, as concerns over the ongoing US-China trade war and its impact on the global economy fueled demand for safe-haven assets. The June 5 contract for MCX Gold surged to ₹95,894 per 10 grams during early trading, marking a fresh record. As of 9:30 AM, the contract was up by 0.22% at ₹95,869 per 10 grams.
The rally in gold was primarily driven by geopolitical uncertainty, including the escalation of the trade war and the absence of constructive progress in tariff negotiations between the US and China. Additionally, weakness in the US dollar and strong demand for physical gold supported the price rise. The US dollar’s fall against its major counterparts, combined with the ongoing trade war, has made gold a more attractive investment. The dollar is on track to experience its fourth consecutive weekly loss.
Geopolitical Uncertainty and Inflation Fears Push Gold Higher
US President Donald Trump’s tariffs on China, which have now reached 245%, have exacerbated tensions between the two largest economies. Trump’s recent decision to probe potential new tariffs on critical minerals, pharmaceuticals, and chip imports further stoked fears of a prolonged trade war. Analysts believe this geopolitical uncertainty is likely to keep gold prices elevated for the time being.
Jateen Trivedi, VP Research Analyst at LKP Securities, noted that until there are indications of de-escalation or progress in trade talks, gold prices could remain strong. However, the rally may lose momentum if the US and China resume discussions or ease tensions. In the previous trading session, MCX Gold settled with a solid gain of 2.42% at ₹95,710 per 10 grams, after briefly hitting ₹95,740.
Market Outlook for Gold Prices
This year, domestic spot gold prices have surged by 24%, driven by global economic uncertainties, including Trump’s tariff policies, which could lead to higher inflation and unemployment in the US. These factors have raised questions about the US Federal Reserve’s future interest rate decisions. Fed Chairman Jerome Powell recently stated that the central bank would await more clarity on the economic outlook before considering changes to interest rates. Powell also expressed concerns that Trump’s tariff policies could further complicate the Fed’s ability to meet its inflation and employment targets.
For now, gold prices are expected to continue to be influenced by global developments. Jateen Trivedi forecasts that MCX Gold will trade in a range of ₹94,000 to ₹95,500, with attention focused on any major updates in the US-China trade negotiations.
Technical Levels for Gold
Manoj Kumar Jain of Prithvifinmart Commodity Research provided technical levels for gold prices, noting support at $3,300–$3,274 and resistance at $3,374–$3,400 per ounce. On the MCX, gold has support at ₹95,050–₹94,400 and resistance at ₹96,000–₹96,600. Jain suggests a buying opportunity around ₹95,200, with a stop-loss at ₹94,750 and a target of ₹96,000. He also recommends buying silver around ₹95,800, with a stop-loss at ₹95,220 and a target of ₹97,000.
In conclusion, while gold prices have surged to record levels amid ongoing geopolitical tensions, their future trajectory will be closely tied to developments in the trade war and any changes in global economic conditions.
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