New Delhi, April 20: Gold has had a remarkable run in the first four months of 2025, soaring nearly 25% and hitting record highs on both the Multi Commodity Exchange (MCX) and COMEX. Silver has also posted solid gains, rising 15% on COMEX, according to a report by Motilal Oswal Financial Services Ltd (MOFSL).
The rally has been driven by a mix of intensifying geopolitical tensions, escalating trade conflicts—particularly between the U.S. and China—and a surge in safe-haven buying from institutional and retail investors alike.
Motilal Oswal remains optimistic about the outlook for gold. The firm expects continued support for prices due to persistent trade frictions, inflationary pressures, and sustained gold purchases by central banks.
From a technical standpoint, MOFSL highlights strong support for gold at ₹91,000 per 10 grams and resistance near ₹99,000 on MCX. On COMEX, key levels to watch are between $3,100 and $3,400 per ounce.
“With global economic growth slowing and policy uncertainty on the rise, gold continues to serve as a reliable safe-haven asset,” said Navneet Damani, Group Senior Vice President and Head of Commodity and Currency Research at MOFSL.
“As central banks boost reserves and investors seek shelter, we maintain a 'buy on dips' strategy for gold over the medium to long term.”
While silver has trailed gold in terms of momentum, both in scale and speed, it too has benefited from the broader risk-off sentiment.
Recent remarks by President Trump regarding higher tariffs on Chinese imports briefly triggered a correction in gold prices. However, the metal quickly rebounded, underscoring strong investor confidence. The Trump administration has adopted a hardline trade stance, imposing tariffs as high as 245% on Chinese goods. In response, Beijing has announced retaliatory measures, fueling fears of a prolonged economic slowdown or even stagflation in the U.S.
Adding to the uncertainty, the U.S. dollar has weakened significantly—down over 7% against a basket of major global currencies this year—further supporting demand for gold.
MOFSL also noted that central banks, especially in emerging markets like China, have been steadily increasing their gold reserves, lending additional strength to the ongoing price rally.
Monetary policy dynamics have also influenced market sentiment. After implementing three interest rate cuts in 2024, the U.S. Federal Reserve has shifted to a cautious “wait and watch” stance in 2025, amid ongoing trade tensions. While President Trump has pushed for further rate reductions to spur growth, Fed Chair Jerome Powell has taken a more restrained approach, citing inflation risks tied to tariffs and global economic volatility.
“In the absence of a meaningful resolution to global trade disputes, the broader macroeconomic backdrop continues to favour gold and other safe-haven assets,” the MOFSL report said.
