Gold and silver prices in India traded lower on Friday, tracking weakness in global bullion markets as a stronger US dollar and elevated crude oil prices fuelled expectations of higher interest rates by the US Federal Reserve.
MCX gold rate today for June futures declined by ₹501, or 0.31%, to ₹1,59,105 per 10 grams. MCX silver price for July futures fell by ₹2,320, or 0.84%, to ₹2,72,563 per kg.
This week so far, MCX gold price has risen 0.23%, while MCX silver price has remained flat.
In the international market, gold prices edged lower as the US dollar hovered near a six-week high, making dollar-denominated bullion more expensive for holders of other currencies. The yellow metal has declined around 0.4% so far this week.
Spot gold price slipped 0.5% to $4,519.72 per ounce, while US gold futures for June delivery eased 0.5% to $4,520.30 per ounce. Spot silver price dropped 1.1% to $75.82 per ounce.
Meanwhile, crude oil prices advanced as investors remained sceptical about the prospects of a breakthrough in US-Iran peace talks.
Higher crude oil prices tend to elevate inflation risks, strengthening expectations that interest rates could remain elevated for longer. Markets are currently pricing in a US Fed rate hike before the end of the year, with a 60% probability of a move by December, according to CME Group’s FedWatch tool.
Although gold is traditionally viewed as a hedge against inflation, a higher interest rate environment generally weighs on the non-yielding precious metal.
Gold Price Outlook
MCX gold prices remained range-bound between ₹1,57,500 and ₹1,60,400 this week, while continuing to hold above key daily moving averages.
“The 20-, 50-, 100- and 200-DEMA are positioned at ₹1,56,363, ₹1,54,705, ₹1,51,940 and ₹1,51,940, respectively, indicating that the broader trend remains positive. Meanwhile, open interest declined by nearly 1,200 lots, signalling profit-booking and limited aggressive fresh participation at higher levels,” said Kaveri More, Commodity Technical Analyst at Choice Broking.
According to More, traders should closely monitor a sustained breakout beyond the current trading range, as it could determine the next directional move in gold prices.
Silver Price Outlook
In the domestic market, MCX silver prices have maintained strength above the 20-DEMA level of ₹2,67,684. The metal has also rebounded from an important 50% retracement zone, indicating renewed buying interest at lower levels.
“A sustained breakout above ₹2,80,400 could accelerate momentum towards ₹2,86,800 and potentially beyond the psychological ₹3,00,000 mark in the coming sessions. On the downside, immediate support for silver is placed at ₹2,65,000, followed by a stronger support zone near ₹2,49,300,” More added.
She further noted that uncertainty surrounding uranium trade discussions, disputes over control of the Strait of Hormuz, and the US rejection of certain geopolitical proposals continued to support safe-haven sentiment across precious metals markets.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
