Gold, silver rise in India today: Here’s why Tata MF sees support building despite volatility

Gold and silver prices rose in domestic futures trade on Tuesday (May 12), supported by fresh buying, steady spot demand and intermittent safe-haven interest, even as global prices showed mixed movement.

Gold futures on the Multi Commodity Exchange of India Limited Multi Commodity Exchange of India edged higher as participants added fresh positions amid firm underlying demand. The June contract rose ₹194, or 0.13%, to ₹1.53 lakh per 10 grams, with turnover of 1,174 lots.

Analysts said the uptick was driven by fresh positioning in the derivatives market along with supportive physical demand, even as global cues remained subdued.

In contrast, international gold futures slipped 0.44% to about $4,715.16 per ounce, reflecting pressure from a stronger dollar and profit-taking.

Silver also gained in domestic trade, tracking safe-haven demand linked to geopolitical tensions in West Asia along with selective industrial support. The July silver contract rose ₹751, or 0.27%, to ₹2.79 lakh per kilogram, with turnover of 4,350 lots.

However, global Comex silver futures declined 0.91% to around $85.27 per ounce.

Tata MF view: Consolidation near term, bullish long-term

According to a house view from Tata Asset Management, gold is expected to remain volatile in the near term, with prices likely to consolidate amid mixed macroeconomic signals, including “higher for longer” US interest rates, elevated bond yields and a strong dollar.

The fund house expects short-term fluctuations of around ±5%, while noting that geopolitical developments—particularly tensions involving the US and Iran—could keep prices volatile in the near term.

However, it maintains a constructive long-term outlook, citing central bank buying, high global debt levels, and gradual diversification away from the US dollar as key structural supports. For Indian investors, rupee depreciation is also expected to cushion downside risks in domestic prices.

On silver, Tata MF expects continued volatility due to weaker global growth prospects and cyclical industrial demand trends. While near-term support may come from Chinese demand, the medium-term outlook remains sensitive to broader economic conditions.

At the same time, structural demand from sectors such as solar energy and electric vehicles continues to provide long-term support, even as price swings remain sharp.

Overall, the fund house recommends a staggered investment approach in precious metals, highlighting gold’s role as a strategic long-term portfolio hedge and silver’s more cyclical but structurally evolving demand profile.