Gold and silver prices today: Rates of gold and silver dropped by up to 1% in early deals on the MCX on Friday, 14 August, as concerns over sticky inflation fuelled expectations of monetary tightening, weighing on non-yielding bullion.
MCX gold October futures were 0.69% down at ₹1,52,406 per 10 grams, while MCX silver September futures were 0.85% down at ₹2,33,455 per kg around 9:15 AM.
US gold futures for December delivery declined 1% amid profit-taking after the yellow metal rose to an over-two-month high in the previous session.
The dollar index eased by 0.10%, but it failed to offset the concerns over oil price volatility, its impact on inflation, and the resulting interest rate hikes. Meanwhile, the dollar index looks set to snap its two-week losing run.
Brent crude inched up by half a per cent to trade above $87 per barrel as the Middle East conflict and uncertainty over the opening of the Strait of Hormuz persist.
Al Jazeera reported US Defense Secretary Pete Hegseth saying on Thursday that Washington can continue with its naval blockade of Iranian ports “indefinitely” and for as long as needed.
The market is divided over the prospects of interest rate hikes by the US Federal Reserve in the near future.
US Consumer Price Index (CPI) climbed 0.1% month-on-month in July after dropping 0.4% in June. Year-on-year, the CPI increased 3.4% after rising 3.5% in June.
An in-line US inflation print followed last week’s jobs data, which showed US nonfarm payrolls dropped by 23,000 in July, against expectations of an 80,000 increase.
Meanwhile, US producer prices were unchanged in July, raising expectations that interest rates will stay unchanged next month.
However, the Middle East conflict and its impact on energy prices remain key variables the market finds difficult to discount.
Inflation has been above the Fed’s 2% target for five years. The next reading of the Personal Consumption Expenditures (PCE) price index, the Fed’s preferred inflation gauge, for July is due on 26 August.
“Softer U.S. inflation and PPI data have strengthened expectations that the Federal Reserve could hold rates steady in September, with markets now pricing roughly a one-in-three chance of a hike. This remains supportive for non-yielding bullion, although profit booking has emerged after gold moved above its 100-day moving average,” said Ravi Singh, Chief Research Officer at Master Capital Services.
“Uncertainty around the reopening of the Strait of Hormuz continues to keep energy prices and inflation risks in focus, while renewed investor demand and stronger Chinese central-bank purchases provide additional support,” said Singh.
Gold price outlook
Jigar Trivedi, Senior Research Analyst at IndusInd Securities, believes MCX gold October futures may decline to ₹1,52,000 per 10 grams due to weak momentum in global markets.
Singh highlighted that MCX gold futures faced resistance near the falling trendline around ₹1,56,000 and witnessed profit booking, with prices now finding immediate support near ₹1,52,600.
“A sustained break below this level could extend the correction towards ₹1,50,000. However, the broader structure remains constructive as prices continue to trade above key EMAs, keeping the buy-on-dips strategy intact unless the key support levels are decisively breached,” said Singh.
“The recent pullback in MCX is in line with international gold, where XAU/USD retreated from a 10-week high but remained on track for a second consecutive weekly gain,” Singh said.
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Disclaimer: This article is for educational purposes only and does not constitute investment advice. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
