Gold prices surged to an unprecedented Rs 1,17,561 per 10 grams on October 3, 2023, driven by safe-haven demand as investors reacted to the looming threat of a US government shutdown. This price marked an increase of Rs 1,217 from the previous day, reflecting significant momentum in both domestic and international markets.
On the Multi Commodity Exchange (MCX), gold futures for December delivery continued their upward trend, rising for the fourth consecutive session by 1.04 percent. The February 2026 contract also saw a substantial rise, jumping Rs 1,314, or 1.12 percent, reaching a milestone of Rs 1,18,788 per 10 grams.
Silver prices joined the rally, hitting new heights as well. The white metal futures for December delivery increased by Rs 1,101 or 0.77 percent, reaching Rs 1,44,200 per kilogram. Similarly, the March 2026 silver futures appreciated by Rs 1,127 or 0.78 percent, marking a new high of Rs 1,45,858 per kg.
Market analysts attribute this surge to increasing demand for precious metals due to concerns over potential economic instability caused by the impending US government shutdown. “Gold and silver extended their bullish momentum as safe-haven demand surged amid concerns over a potential US government shutdown,” explained Rahul Kalantri, Vice-President of Commodities at Mehta Equities Ltd.
Internationally, gold futures reflected a similar bullish trend, increasing over 1 percent to reach USD 3,895.22 per ounce. Silver prices also recorded gains, slightly rising to USD 47.41 per ounce. Jigar Trivedi, Senior Research Analyst at Reliance Securities, noted that “gold prices rose to a fresh record high of USD 3,895 per ounce, heading for their biggest monthly gain in 14 years as investors rushed to safe-haven assets.”
September proved to be lucrative for gold, with prices increasing over 11 percent, a remarkable performance amid market uncertainties. With current funding for the US government set to expire at midnight on Tuesday, discussions between President Donald Trump and congressional leaders remain stalled, raising the specter of a government shutdown.
If no agreement emerges, a shutdown could begin on Wednesday, adversely affecting the release of critical economic indicators, including the September nonfarm payrolls report. Trivedi added, “Last week, US macroeconomic data reinforced bets that the Federal Reserve could implement further interest rate cuts at its remaining meetings this year.”
This broader economic backdrop supports the rise in gold prices, as fresh tariffs on heavy trucks, patented drugs, and other goods are set to take effect on the same day, triggering additional concerns in the markets.
Moreover, the surge in interest for gold exchange-traded funds indicates strong investor confidence in the asset class. Renisha Chainani, Head of Research at Augmont, highlighted that “Gold exchange-traded funds attracted USD 10.5 billion in September, lifting total inflows this year to about USD 50 billion as investors flocked to safe-haven assets amidst global uncertainty.”
As gold prices continue to climb, the market remains vigilant around geopolitical and economic developments that could further influence investor behavior and market dynamics.
