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Strong US Dollar Drags Down Gold and Silver Prices in Domestic Market
Gold and Silver Prices Today: Gold and silver prices fell in the national capital's bullion market amid global tensions. Gold fell by ₹11,000, while silver also fell by ₹20,000. Let's explore the detailed bullion market situation.
Precious metal prices dipped by up to four percent in the national capital on Friday due to a strong dollar and doubts over a rate cut in monetary policy. Silver dipped by ₹11,000 to ₹2,65,500 per kg. In another development, gold dipped by ₹2,000 to end at ₹1,63,200 per ten grams.
According to the All India Sarafa Association, silver fell 3.97 percent to close at ₹265,500 per kilogram (including all taxes), down from Thursday's close of ₹276,500 per kilogram. Gold of 99.9 percent purity in the bullion market fell 1.21 percent to close at ₹163,200 per ten grams. It had closed at ₹165,200 per ten grams in the previous session. Dilip Parmar, senior research analyst at HDFC Securities, said that gold prices in the domestic market remained under pressure due to a strong US dollar and changing expectations of monetary policy easing.
He said that the escalating conflict in Iran has pushed up crude oil prices, raising inflation fears. This could force central banks to maintain a tight stance for a longer period. Parmar said, "Although short-term volatility and long-term selling by traders may continue, the outlook remains positive. Once geopolitical tensions stabilize, central bank acquisitions and a resurgence in retail investment are expected to provide a strong base for prices." In the international market, spot silver was trading down nearly one percent at $83.14 per ounce, while gold was marginally higher at $5,088 per ounce.
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Aamer Makda, commodity and currency analyst at Choice Broking, said that gold prices have fallen for the second consecutive week in the international market. It is trading below $5,100 per ounce. The main reasons for this decline are a strong US dollar, rising oil prices, and geopolitical concerns in the Middle East. A surge in US Treasury yields has also put pressure on the precious metal.
Concerns have increased regarding the Federal Reserve's rate cut outlook. The minutes of the last FOMC meeting and recent expectations do not indicate much inclination towards monetary policy easing. Investors are now focusing on US growth data, which can provide insight into overall economic health.
