Geopolitical factors and supply-demand dynamics will maintain commodity price volatility in Samvat 2083

Experts predict that geopolitical events, changes in global interest rates, and evolving supply and demand dynamics will remain key factors influencing the commodity market during Samvat 2083. Analysts note that oil and precious metal prices will continue to dictate trends in Indian markets.

The World Bank expects a decrease in oil and most metal prices compared to the high averages of 2026. However, there is an optimistic scenario for gold, based on central bank purchases and fiscal uncertainty. It is projected that crude oil prices will fall by 20 percent, but persistent global uncertainty could lead to price increases.

Oil and Gold Forecasts

Navneet Damani, Head of Commodity Research at Motilal Oswal Financial Services, stated that "Samvat 2083 is likely to remain volatile for oil prices." He anticipates some normalization in oil prices if geopolitical tensions between the US and Iran ease, with Brent prices potentially stabilizing in the $75–80 per barrel range, and West Texas Intermediate (WTI) around $70.

Damani warns that any escalation leading to new political events in the US in January could trigger renewed volatility. The next three months will be critical, and crude oil prices are expected to fluctuate within a wider range of $70–120 per barrel.

Vedika Narvekar, Commodity and Currency Analyst at Anand Rathi Shares and Stock Brokers, foresees Brent Crude Oil trading in the $80–110 price corridor. She believes the oil market is in a tug-of-war between supply risks and diplomacy. Narvekar added that commodity markets are experiencing a deficit as diesel fuel is used during winter, and reserves are dwindling. However, talks with Iran, interim results, and the G7 release of 100 million barrels limit the potential for growth.

Nevertheless, Narvekar noted that provided tensions decrease, a deal is struck between the US and Iran, and supplies normalize, oil prices could drop below $70 per barrel. She also considers gold to be the most stable of the three assets in Samvat 2083.

Gold prices are supported by central bank purchases, inflows into Exchange Traded Funds (ETFs), the US deficit approaching $2 trillion, and any concerns about stagflation. The main risks cited are a possible Fed rate hike in December and high yields. Narvekar forecasts that gold on MCX will trade in the range of ₹1.3 lakh – ₹1.75 lakh, reaching $4,900 (approximately ₹1.75 lakh) by the end of 2027.

Damani advises accumulating gold during dips around $3,800–$3,900, setting short-term targets at $4,200 and medium-term targets at $4,500–$4,700. At an exchange rate of 96 rupees per dollar, he sees a accumulation zone at ₹1.35 lakh with targets of ₹1.48 lakh and ₹1.6–₹1.68 lakh.

Silver, which lost over 55 percent from record highs in Samvat 2082, may remain volatile. Narvekar pointed out that silver has a stronger supply history, as a sixth consecutive deficit is expected in 2026 and a five-year deficit exceeding 800 million ounces. Nevertheless, sentiment related to solar savings and artificial intelligence (AI) supports a higher beta coefficient for silver compared to gold, with support at $48, where a break opens the $45 level.

This forecast follows a year of sharp divergence in commodity dynamics. In Samvat 2082, Brent Crude Spot oil prices rose by 60.4 percent after falling by 17.7 percent in the previous Samvat. Gold and silver, conversely, declined by 6.6 percent and 0.8 percent, respectively, in international markets. However, domestic prices remained resilient: gold grew by 10.8 percent, and silver by 12.2 percent, aided by the weakening rupee.

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business-standard.comNovember 8, 09:18

Precious metal prices may remain under pressure amid geopolitical tensions and inflation

Analysts predict that precious metal prices are likely to remain under pressure next week. This is because investors are closely monitoring developments in the conflict between the US and Iran, as well as changes in crude oil prices and inflation data, which provide insight into interest rate prospects.

The main focus will be on inflation figures from China, the US, Germany, Japan, and India. Additionally, investors will closely watch statements from Federal Reserve representatives and US employment data. Adding to this, Chinese economic indicators are important for industrial metals.

Geopolitical events remain a key factor, as US President Donald Trump confirmed new military strikes against Iran. At the same time, he stated that Washington has achieved 'many successes' in negotiations with Tehran, adding another layer of uncertainty.

The domestic commodity market will be closed during the morning session on Tuesday due to the Diwali-Balipratipada holiday. Pranav Mer, Senior Vice President of EBG - Commodity & Currency Research at JM Financial Services Ltd., noted that investors will also track progress in peace talks between the US and Iran to end the war, as well as negotiations between Russia and Ukraine.

On the Multi Commodity Exchange, gold futures with December delivery rose by ₹3,682, or almost 3 percent, last week, closing at ₹1.42 lakh per 10 grams. Silver futures increased by ₹5,655, or 3.15 percent, reaching ₹1.84 lakh per kilogram.

In international markets, Comex gold futures with December delivery rose by $176, or 4.5 percent, over the week, ending trading at $4,074.9 per ounce. Silver gained $2.6, or 5.4 percent, settling at $51.94 per ounce.

Mer reported that initially, precious metal prices were under pressure due to stronger-than-expected US non-farm payrolls data and improved consumer sentiment, which contributed to the strengthening dollar and Treasury yields. However, at the end of the week, prices showed strong growth of more than 4 percent in global markets after a sharp rally mid-week, which followed the results of the US midterm elections, where Democrats defeated Republicans in the Senate and House of Representatives.

Analysts believe that precious metals recovered during the week due to buying at lower prices and covering short positions, although the growth was limited by a correction in industrial metals, especially copper. This growth was also supported by demand for capital preservation following the decline in AI, data center, and technology stocks in global markets, particularly in the US.

Nevertheless, on Friday, precious metal futures faced selling pressure, with gold and silver closing at approximately $4,074 and $52 per ounce, respectively. Domestic market prices may show moderate fluctuations influenced by global signals, currency movements, inflation trends, and festive demand during Diwali.

business-standard.comNovember 6, 17:10

Rupee continued to weaken in Samvat 2082 amid FPI outflows, and 10-year bond yields rose

Throughout Samvat 2082, the rupee demonstrated steady weakening, losing 6.37 percent against the US dollar. This was caused by global uncertainty, the outflow of Foreign Portfolio Investors (FPI), and the widening trade deficit. It is worth noting that in the previous Samvat, the Indian currency fell by 4.4 percent against the dollar.

Investor sentiment was influenced by the introduction of mutual tariffs by the US on Indian goods, uncertainty surrounding trade negotiations, the strengthening dollar, and a constant outflow of foreign capital. Furthermore, the escalation of geopolitical tensions in the Middle East since late February exacerbated the rupee's weakening, as rising crude oil prices raised concerns about India's current account and import bill.

In May 2026, the national currency reached an all-time low of 96.96 per dollar, which occurred amidst high oil prices, weak capital inflows, and a strong dollar.

Market Forecasts

Madan Sabnavis, Chief Economist at Bank of Baroda, noted that the past Samvat was volatile for markets, where global upheavals largely determined the dynamics of stocks, currencies, and bonds. He emphasized the unprecedented interconnectedness reflecting the high strength of globalization. Stocks generally declined as investors favored other countries, and Indian markets recorded a larger outflow of FPI than inflow. The rupee faced continuous pressure due to the negative FPI position, the widening trade account, and the strengthening dollar.

To curb excessive volatility, the Reserve Bank of India (RBI) intervened in the foreign exchange market. In June, it also launched a special dollar-rupee swap mechanism to attract new non-resident deposits in foreign currency and support the national currency.

By the end of Samvat 2082, the rupee recovered, closing at 93.91 per dollar on November 6, which was the strongest level since April 22. Nevertheless, it remained 6.37 percent weaker than at the beginning of the period, when its rate was 87.9325.

VRC Reddy, Head of Treasury at Karur Vysya Bank, commented that the departing Samvat was challenging for Indian markets, marked by geopolitical tension, high crude oil prices, global yield pressure, and FPI outflows. Bond yields remained unstable, peaking at 7.50 percent, while the rupee faced constant devaluation pressure, reaching an all-time high of 96.96.

Government Bond Market

The government bond market saw rising yields, driven by global bond movements, concerns over domestic inflation, and expectations of monetary policy tightening. The yield on the benchmark 10-year government bond increased by 69 basis points to 7.19 percent on November 6, compared to 6.50 percent at the start of the period.

Yields were influenced by changes in US Treasury yields, actions by the RBI and the US Federal Reserve, as well as domestic liquidity conditions. Pressure intensified due to expectations of higher global interest rates, foreign investor outflows, and concerns about government borrowing.

Although RBI measures to lower rates and inject liquidity initially supported the debt market, inflation concerns and rising crude oil prices limited gains. The conflict in the Middle East towards the end of the year further fueled fears of imported inflation.

In October, the RBI raised the repo policy rate by 25 basis points to 5.50 percent and changed its stance to calibrated tightening, signaling a shift in interest rate outlook. Following this, the 10-year yield reached 7.48 percent on October 26 before falling to 7.19 percent by November 6, thanks to easing crude oil prices and declining global yields, which improved market sentiment.