Silver Futures Hit Record High on Fed Rate Cut

New Delhi, Dec 11 (PTI) Extending the record-breaking run to a third day, silver prices scaled a fresh peak of Rs 1,93,720 per kilogram in the futures trade on Thursday following strong global trends and a rate cut by the US Federal Reserve.

Silver futures soared by Rs 4,985, or 2.64 per cent, to touch an all-time high of Rs 1,93,720 per kg on the Multi-Commodity Exchange (MCX). The white has been trading at record high levels in the past three sessions, surging by Rs 11,978, or 6.6 per cent, from Rs 1,81,742 per kg on Monday.

So far this year, silver prices have zoomed by Rs 1.06 lakh (Rs 1,06,487), or 122.07 per cent, from Rs 87,233 per kilogram on December 31, 2024.

Meanwhile, gold futures for February delivery appreciated by Rs 845, or 0.65 per cent, to Rs 1,30,641 per 10 grams on the MCX.

"Gold continues to trade steady while silver marked an all-time high on domestic as well as on Comex, as market participants digest yet another cautious cut by the US central bank," Manav Modi, Commodities Analyst – Precious Metal Research, Motilal Oswal Financial Services Ltd, said.

The US Federal Reserve on Wednesday cut interest rates by 25 basis points, marking the central bank's third cut of the year, while retaining projections for only one reduction in 2026.

Policymakers, however, signalled uncertainty around the pace of future easing, even as they upgraded growth forecasts and trimmed inflation estimates for 2025 and 2026.

In the international market, Comex gold futures for February delivery increased by USD 20.2, or 0.49 per cent, to USD 4,245.2 per ounce, supported by a steep fall in the US dollar index to 98.62 and softer Treasury yields.

"Gold prices rose to around USD 4,230 per ounce, gaining for a third consecutive session and approaching October levels, when they hit a record, after the Fed trimmed interest rates by 25 bps, lifting overall risk sentiment," Jigar Trivedi, Senior Research Analyst at Reliance Securities, said.

On the Comex, silver futures for the March contract climbed by USD 2.22, or 3.64 per cent to a record of USD 63.25 per ounce. The metal has gained USD 4.84, or 8.3 per cent, over the past three sessions.

In the calendar year so far, silver futures have risen by USD 32.28, or 104.26 per cent from USD 30.96 per ounce on December 31, 2024.

"Silver continues to trade firmly on the back of geopolitical uncertainty despite the Fed's cautious outlook for 2026," Renisha Chainani, Head - Research at Augmont, said.

She added that geopolitical risks contributed to the metal's safe-haven appeal, including the US interception of a sanctioned ship near Venezuela and persistent uncertainty regarding the Russia-Ukraine peace process.

Nikunj Saraf, CEO, Choice Wealth, said, gold and silver ETFs have been quiet heroes of the year, delivering standout returns even as equity markets saw bouts of volatility.

"Silver, especially, stole the spotlight, a rare combination of booming industrial demand from solar, EVs and electronics, alongside tightening global supply, pushed prices sharply higher, while gold too held its ground and climbed steadily, supported by persistent central-bank buying and investors seeking safety amid geopolitical and inflation worries," he added.