Gold, silver ETFs jump up to 3% today as bullion prices rally on softer US rate outlook

Gold and silver exchange-traded funds (ETFs) in India rallied 2-3 percent on Friday, mirroring gains in global precious metal prices, as weaker-than-expected US labour market data strengthened expectations that the Federal Reserve could adopt a less aggressive interest rate stance.

At around 1:10 pm, Nippon India ETF Gold BeES climbed 2.4 percent to Rs 120.51, while ICICI Prudential Gold ETF gained 2.4 percent to Rs 124.90. SBI Gold ETF rose 2.3 percent to Rs 124.25, and Tata Gold Exchange Traded Fund advanced 2.3 percent to Rs 14.14.

Silver ETFs outperformed their gold counterparts as silver prices rallied more sharply in the international market. Nippon India Silver BeES gained 2.6 percent to Rs 221.95, Tata Silver Exchange Traded Fund rose 2.6 percent to Rs 22.55, SBI Silver ETF advanced 2.5 percent to Rs 227.28, and ICICI Prudential Silver ETF added 2.4 percent to Rs 231.28.

The rally followed a strong move in global bullion prices. Spot gold rose 1 percent to $4,165.29 an ounce after touching its highest level since June 23 earlier in the session. US gold futures for August delivery gained 1.3 percent to $4,178.50. Bullion was on track for its first weekly gain in five weeks, rising about 1.8 percent for the week, as softer-than-expected US nonfarm payrolls and private payrolls data eased concerns over persistent inflation and the prospect of higher-for-longer interest rates.

Silver also extended its rally, with spot prices climbing 2.1 percent to $62.28 an ounce. Platinum gained 2.4 percent to $1,655.15, while palladium rose 0.9 percent to $1,278.89. All three metals were trading near their highest levels in more than a week and were headed for weekly gains.

In India, physical gold demand softened on Friday after witnessing a modest pick-up earlier in the week, as the rebound in prices prompted buyers to stay on the sidelines, Reuters reported. Domestic gold prices climbed to as much as Rs 148,046 per 10 grams after falling to a three-month low of Rs 140,450 on Tuesday. Prices had declined about 8.4 percent in June, their first monthly fall since March, tracking volatility in global bullion markets.

The gains in precious metal ETFs came even as broader market sentiment remained constructive. At 1:10 pm IST, the Sensex was up 432.10 points, or 0.56 percent, at 77,934.22, while the Nifty advanced 144.55 points, or 0.60 percent, to 24,320.25. India VIX fell 3.34 percent, indicating easing volatility expectations.

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