Silver prices climbed by Rs 5,054 to Rs 2.71 lakh per kilogram in futures trade on Tuesday, tracking strong gains in overseas markets as investors assessed developments in West Asia and awaited key US economic data.
On the Multi Commodity Exchange, the white metal appreciated by Rs 5,054, or 1.9 per cent, to Rs 2,71,217 per kg in a business turnover of 10,497 lots.
“Silver has recovered from its recent lows as investors adopted a wait-and-see stance ahead of Middle East peace talks,” Renisha Chainani, Head of Research at Augmont, said.
Meanwhile, Lebanon announced a limited ceasefire between Iran-backed Hezbollah and Israel, but wider geopolitical risks kept traders cautious.
Earlier, traders widely anticipated a 60-day ceasefire extension over the weekend. Instead, both sides have entrenched themselves around their respective red lines, and no agreement has been reached, Chainani said.
In global markets, Comex silver futures for the July contract increased nearly 3 per cent to USD 77.21 per ounce in New York.
Chainani noted that investors are awaiting the US nonfarm payroll and employment reports, both due later this week, to gauge labour-market strength amid growing inflation concerns tied to the West Asia conflict.
Attention also turns to comments from Federal Reserve (Fed) officials, including Cleveland Fed President Beth Hammack and Fed Governor Michael Barr, for clues on the future policy direction, she added.
“Markets now expect the Fed to raise its benchmark interest rate next, a reversal from the rate-cut expectations held before the Iran war began. The shift reflects rising energy prices and their likely upward pressure on inflation,” Chainani said.