The Multi Commodity Exchange (MCX) February gold contract has reached a new record high of ₹1,43,340 per 10 grams, marking a significant milestone for precious metals trading. This achievement comes amid persistent geopolitical uncertainty that continues to drive safe-haven demand for gold and silver.

Intraday Trading Performance

Gold futures experienced sharp price swings during the trading session, demonstrating the volatile nature of precious metals markets. The contract's performance showed remarkable resilience despite opening lower.

The February 5 contract initially opened ₹1,740 lower than the previous close but quickly recovered to establish the new record high. At the last check, futures were trading at ₹1,43,306, representing a gain of ₹1,065 or 0.75%.

Silver Reaches Historic Milestone

Simultaneously, silver prices achieved their own historic milestone by rising above $90 per ounce for the first time ever. This development underscores the broader strength in precious metals markets and reinforces the safe-haven appeal of these commodities during uncertain times.

Market Drivers and Geopolitical Factors

Precious metals have demonstrated strong performance following blistering rallies, with multiple geopolitical factors contributing to sustained demand. The prospect of a criminal indictment against Federal Reserve Chair Jerome Powell has revived concerns about the monetary authority's independence, according to Bloomberg reports.

Central bankers worldwide have rallied behind Powell, while JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon indicated that political intervention could backfire. Additional factors supporting haven demand include:

• Trump's capture of Venezuela's leader
• Renewed threats to take Greenland
• Violent protests in Iran that could potentially lead to regime change

Analyst Forecasts and Price Targets

Citigroup Inc. analysts have significantly upgraded their precious metals forecasts this week, projecting ambitious price targets for both gold and silver within the next three months.

"We upgrade our near-term price forecasts across the precious metals complex as investment momentum remains strong and the multitude of bullish drivers are now likely to remain intact during Q1FY26," the Citi note stated. The analysts cite strong investment momentum and multiple bullish drivers that are expected to persist through the first quarter of FY26 as key factors supporting their optimistic outlook.

Silver has reached a historic milestone by surging past $90 per ounce for the first time ever, marking a significant achievement for the precious metal. The metal's total asset value now stands at $5.038 trillion, reflecting its growing strategic importance in the global economy and strong market performance.

Market Performance Overview

Spot silver rose over 3% to cross the $90 per ounce threshold, demonstrating exceptional strength in the precious metals market. The current market snapshot shows silver's dominant position among major assets:

Key Drivers Behind Silver's Rally

Several fundamental factors are driving silver's exceptional performance. Weaker U.S. inflation data has bolstered expectations for further interest rate cuts, creating a favorable environment for precious metals. Geopolitical tensions and a weaker dollar have amplified safe-haven demand, with investors seeking refuge in tangible assets.

The Federal Reserve's monetary policy continues to support precious metals, with three U.S. Fed cuts contributing to lower interest rates. Additionally, geopolitical flashpoints from Venezuela to Nigeria have further boosted silver's appeal as a store of value during uncertain times.

Industrial Demand and Supply Constraints

Silver's industrial indispensability adds significant fuel to the current rally. The metal plays a critical role in several high-growth sectors:

• Electric vehicles manufacturing
• Solar panel production
• Electronics industry
• AI data centers infrastructure

Governments accelerating energy transitions and expanding data infrastructure have made silver demand unavoidable. This industrial requirement creates a strong foundation for sustained price appreciation.

Supply Market Challenges

The supply side presents significant constraints that support higher prices. The silver market faces its fifth consecutive year of deficits, with mining output lagging behind consumption levels. Inventories hover near historic lows, creating additional pressure on available supply.

Unlike gold, which enjoys deep liquidity and lending pools estimated at $700 billion in London, silver lacks comparable buffers. This fragility was exposed during October's historic supply squeeze, and despite inflows into London vaults, shortages persist globally.

Trade and Policy Implications

A U.S. Commerce Department probe into critical mineral imports could lead to tariffs or trade curbs, potentially straining supply chains further. This regulatory uncertainty adds another layer of complexity to the silver market dynamics and could contribute to continued price volatility.

The combination of strong industrial demand, supply constraints, favorable monetary policy, and geopolitical uncertainties has created a perfect storm for silver's historic price breakthrough, establishing the metal as a significant player in the global asset landscape.