Gold and silver prices may experience a temporary pause next week as market participants adopt a cautious stance in anticipation of significant economic data from the United States, including GDP figures. Analysts suggest that thin trading volumes typical of year-end could further restrict price fluctuations.
Investors will be particularly attentive to important data releases concerning U.S. housing, core durable goods, and consumer confidence, as these indicators are expected to influence global bullion prices.
As we approach Christmas week, traders foresee potential consolidation or even corrections within the markets. This is largely due to the expected low trading volumes, with many major traders likely absent as they prepare for a long weekend beginning late Wednesday. Pranav Mer, Vice President of EBG - Commodity & Currency Research at JM Financial Services Ltd, noted that while participation may be low, this could lead to increased volatility and larger price swings.
Looking ahead, several international markets are anticipated to experience subdued activity in the coming days. Many investors are likely to remain on the sidelines as they gear up for the upcoming Christmas and New Year festivities, according to market experts.
In the past week, gold futures on the Multi Commodity Exchange (MCX) rose by Rs 574, amounting to a 0.43% increase. Notably, gold had reached an unprecedented high of Rs 1,35,590 per 10 grams earlier on Thursday.
Pankaj Singh, a smallcase manager and the Founder and Principal Researcher at SmartWealth.AI, remarked that this week's modest uptick in gold futures across both domestic and international exchanges reflects an unusually consistent rally, marking the fourth consecutive weekly rise in MCX gold futures. This trend positions gold on track for a twelfth straight month of gains—an occurrence that is quite rare in modern bullion markets.
Supporting this perspective, Prathamesh Mallya, DVP of Research for Non-Agri Commodities and Currencies at Angel One, highlighted that Indian markets have seen an increase in gold prices, attributed to the depreciation of the rupee, which recently hit record lows against the U.S. dollar.
On the international front, Comex gold futures experienced a gain of $59, or 1.36%, over the past week. Mallya elaborated that the combination of a weak dollar, a dovish Federal Reserve, and lower inflation rates in the U.S. has contributed to the rising momentum in gold prices. The Fed's recent decision to cut rates by 25 basis points and indications of further easing anticipated in 2026 have improved the outlook for gold.
According to Pankaj Singh, the current upward trend in gold prices is not just a typical cyclical movement. Similar price patterns have only been observed twice in the last fifty years—both during periods marked by significant monetary and geopolitical tension.
As we near the end of 2025, analysts predict that the bullish sentiment surrounding bullion is likely to continue, driven by expectations of global monetary easing and currency weakness, although short-term corrections could still occur.
Silver futures, which have outperformed gold significantly this year, may also see a pause following a remarkable fourth consecutive week of gains. On the MCX, the white metal surged by Rs 15,588, or 8.08%, over the past week, climbing to a record high of Rs 2,08,603 per kilogram on Friday before experiencing a slight pullback due to profit-taking.
Pranav Mer from JM Financial Services commented that silver has continued its impressive rally as it heads toward the year's end, leading the gains with an additional 8% rise last week. The persistent inflow into globally traded exchange funds, coupled with worries about the unwinding of yen carry trades following an anticipated rate hike by the Bank of Japan, have fueled silver's performance.
He further noted that silver has outshone all other asset classes this year, boasting an increase exceeding 130% thus far, driven by solid market fundamentals and supply-demand dynamics. However, he cautioned that caution is warranted in the upcoming trading sessions as a price correction could happen at any moment.
While the medium-term outlook for both precious metals remains positive, Pranav Mer expressed concern over the risk-reward ratio for silver, which seems overstretched following its robust rally. "Silver remains optimistic, yet the risk-reward scenario appears unfavorable. In the near term, prices might test between Rs 2,25,000 and Rs 2,45,000 per kilogram. On the technical side, we maintain a bullish perspective on gold, anticipating prices to rise further to Rs 1,40,000-1,45,000 by early next year, with support for reversal positioned at Rs 1,29,000 per 10 grams," he stated.
