Silver prices surged to fresh record highs on the domestic futures market on Tuesday, tracking gains in global markets as a weaker US dollar, geopolitical tensions and expectations of US rate cuts boosted demand for safe-haven assets. On the Multi Commodity Exchange (MCX), March silver futures saw a sharper rally, jumping 6.9% to a lifetime high of Rs 3,57,000 per kg. February gold futures also climbed 1.48% to Rs 1,58,343 per 10 grams, after hitting an intraday peak of Rs 1,59,820.
The rally came despite some profit-booking at higher levels, underscoring the strength of underlying sentiment for precious metals.
Global Cues Drive Momentum
Internationally, gold and silver also touched record highs as investors flocked to safe-haven assets amid rising political and economic uncertainty. US gold futures for April rose about 1% to $5,113.70 per troy ounce, while COMEX silver surged past the $99-per-ounce mark for the first time.
A key driver was weakness in the US dollar, with the dollar index slipping around 0.1%, making bullion cheaper for holders of other currencies. Persistent central bank buying and expectations of easier monetary conditions globally have further supported prices.
US Political Risks and Trade Tensions
Geopolitical concerns added another layer of support. Renewed fears of a potential US government shutdown and fresh trade tensions under President Donald Trump lifted demand for safe assets. Trump has threatened to impose 25% tariffs on South Korean automobiles, lumber and pharmaceutical imports, while also warning Canada of a 100% tariff if it finalises a trade deal with China.
These developments have heightened uncertainty around global trade flows, reinforcing the appeal of gold and silver as hedges.
Focus on Fed Outlook
Market participants are also closely watching the US Federal Reserve’s policy outlook. While the two-day meeting of the Federal Open Market Committee this week is expected to keep interest rates unchanged, traders are pricing in at least two rate cuts later this year.
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