Key Takeaways:
- Gold prices on the MCX were at Rs 70,987 per 10 grams, while in the international market they hovered around $2,318.82 per ounce.
- Silver was priced at Rs 80,753 per kg on the MCX, with an intraday low of Rs 80,500.
- Comex Gold prices fell due to ease in geopolitical tensions, but pared early losses on weakness in the dollar index and US treasury yields.
- Markets are watching US GDP data and the Fed’s PCE price index report for further insights.
- Acceleration in the PCE index is expected to support the Fed’s case for delaying rate cuts.
- Gold prices on MCX may find support near Rs 70,000, with a potential sell-off towards Rs 68,500 if prices fall below this level.
Gold and Silver Prices React to Market Conditions
Gold prices on the MCX were recorded at Rs 70,987 per 10 grams, hitting an intraday low of Rs 70,844, while in the international market they hovered around $2,318.82 per ounce. Silver was priced at Rs 80,753 per kg with an intraday low of Rs 80,500 on the MCX, whereas internationally the price hovered around $27.36 per ounce.
Geopolitical Tensions Impact Gold Prices
Kaynat Chainwala, Senior Manager of Commodity Research at Kotak Securities, noted that COMEX Gold prices had declined for the second consecutive day due to ease in geopolitical tensions. However, the yellow metal recovered some losses, following weakness in the dollar index and US treasury yields amidst signs of weakness in US Manufacturing and Services PMI. Traders are reconsidering the trajectory of Fed funds ahead of the US GDP data release on Thursday and the Fed’s PCE price index report on Friday.
Expectations for Gold Prices in the Near Future
Jateen Trivedi, VP Research Analyst – Commodity and Currency at LKP Securities, mentioned that gold prices continued to decline on the MCX, with a decrease of Rs 850 per 10 grams. This decline was attributed to a sharp drop in Comex gold prices in the past two days. The easing tensions in the Middle East over the weekend, with Iran and Israel refraining from further drone attacks, also contributed to the decrease in gold prices. Trivedi highlighted that gold prices on MCX may witness support near the Rs 70,000 mark in the coming days. However, if prices fall below this level, another sell-off towards Rs 68,500 could occur as risk sentiments in the Middle East calm down.