Gold prices in Kerala hit record high as global rates soar

Gold prices in Kerala rose to an all-time high on Tuesday, reaching ₹83,840 per sovereign (8 grams), marking an increase of ₹920 from the previous day.

The price of one gram of gold went up by ₹115 to ₹10,480, while the rate of a gram of 18 karat rose by ₹95, reaching ₹8,680. The prices of silver, too, have soared to a record high, reaching ₹147 per gram, according to the All Kerala Gold and Silver Merchants Association, which determines the daily bullion prices in the state. 

The continued rise in gold prices is driven by a strong global trend following the US Federal Reserve's rate cuts, along with expectations of further monetary policy easing. Investors also await Federal Reserve Chair Jerome Powell's speech on Tuesday for further cues on policy. Analysts also suggest that safe-haven buying, fueled by geopolitical tensions and sustained central bank purchases, has put pressure on prices, pushing them up further.

It is likely that a fall in the Rupee's value has also contributed to the trend, as it fell by 25 paise, reaching a record intraday low of 88.53 against the US dollar. This comes after the enhanced US tariffs on Indian goods and the hike in the US H-1B visa fee, which deters investor sentiments.

"The rally in gold and silver showed no signs of slowing, with both metals soaring to fresh records. Gold surged to lifetime highs while silver reached its strongest level in nearly 15 years," Rahul Kalantri, Vice-President of Commodities, Mehta Equities Ltd, told PTI.

Jigar Trivedi, Senior Research Analyst at Reliance Securities, said that traders are awaiting Fed Chair Jerome Powell's remarks on the economic outlook, which is scheduled for later in the day, along with the release of the Personal Consumption Expenditures price index on Friday and the Fed's preferred inflation gauge, for further direction on the monetary policy trajectory.

Investors also highlighted that tensions on the geopolitical stage with the ongoing Russia-Ukraine war and conflicts in the Middle East are likely to heighten safe-haven flows, preventing sharp corrections in bullion despite elevated levels.