Winning Bizness Desk
Mumbai. Gold prices in Delhi witnessed a decline for the second straight day, falling below ₹83,000 per 10 grams. Over two days, gold has become ₹260 cheaper. On Friday, gold prices had reached record highs, but the strengthening of the US dollar has led to this fall. The dollar gained strength following a statement by former US President Donald Trump about imposing a 2.5% global tariff. Additionally, the announcement of the Federal Reserve’s interest rate decision is expected to influence the future direction of the dollar and gold prices.
Gold Becomes Cheaper in Delhi
According to the All India Sarafa Association, weak demand from jewelers and retailers caused a drop in gold prices in the national capital. On Tuesday, gold prices fell by ₹160 per 10 grams. Gold of 99.9% purity dropped to ₹82,840 per 10 grams, down from ₹83,000 per 10 grams on Monday. Similarly, gold of 99.5% purity fell by ₹160, settling at ₹82,440 per 10 grams, compared to its previous close of ₹82,600 per 10 grams.
In contrast, silver prices remained steady at ₹92,000 per kilogram on Tuesday, showing no significant movement.
Gold and Silver Prices Rise on MCX
In the futures market, gold and silver prices showed an upward trend. On the Multi Commodity Exchange (MCX), February delivery gold contracts rose by ₹327, or 0.41%, to ₹79,905 per 10 grams. Similarly, silver contracts for March delivery increased by ₹190, or 0.21%, to ₹90,413 per kilogram.
In the international market, COMEX gold futures rose by $10 per ounce, or 0.36%, to $2,776.20 per ounce during Asian trading hours. COMEX silver futures increased by 0.48% to $30.56 per ounce.
Why Gold Prices Fell
Market experts attribute the fall in gold prices to traders focusing on the Federal Reserve meeting scheduled for Wednesday. This meeting is expected to play a crucial role in influencing the US dollar and determining the future trajectory of gold prices. According to Saumil Gandhi, Senior Analyst (Commodities) at HDFC Securities, the statement by Donald Trump regarding a 2.5% global tariff strengthened the US dollar, leading to continued pressure on gold prices.
Analysts’ Take on Gold Price Trends
Jatin Trivedi, VP of Research (Commodities and Currency) at LKP Securities, stated that a weaker Indian rupee has supported gold prices on MCX, showing a positive trend. On the international front, gold found strong support near $2,735 on COMEX, helping sustain its momentum.
Devaya Gaglani, Senior Research Analyst (Commodities) at Axis Securities, noted that key events this week, such as the Federal Open Market Committee (FOMC) meeting, advance GDP data, consumer confidence reports, and unemployment claims, are expected to cause volatility in gold prices. These factors are likely to contribute to fluctuations in the precious metal's market trends.
This week is anticipated to remain unpredictable for gold prices due to the interplay of global economic factors and market expectations.
