SRINAGAR: Gold prices declined for the fifth consecutive session on Thursday, falling by Rs 277 to Rs 1,47,740 per 10 grams in futures trade, tracking a weak trend in global markets amid ongoing geopolitical tensions in West Asia and shifting expectations on interest rates.
On the Multi Commodity Exchange (MCX), gold futures for August delivery dropped by Rs 277, or 0.19 per cent, to Rs 1,47,740 per 10 grams.
The decline in domestic prices followed sustained weakness in international bullion markets, where investors remained cautious due to the impact of rising energy costs, inflation concerns and uncertainty over the US Federal Reserve’s interest rate trajectory.
In overseas markets, Comex gold futures for August delivery fell for a fifth straight session, easing by USD 17.23, or 0.42 per cent, to USD 4,116.07 per ounce in New York, according to data reported by Reuters.
Market analysts said precious metals were under pressure as stronger US economic indicators and elevated energy prices reinforced expectations that interest rates could remain higher for longer, reducing demand for non-yielding assets like gold.
According to Bloomberg, geopolitical tensions between the United States and Iran initially supported safe-haven demand, but subsequent market developments triggered profit booking as investors reassessed risk levels.
Gaurav Garg, Research Analyst at Lemonn Markets Desk, was quoted as saying that gold prices slipped in domestic trade amid escalating US–Iran tensions, which have added to global uncertainty.
Renisha Chainani, Head of Research at Augmont, said gold continued its downward trend towards the USD 4,000 per ounce mark, despite signs that recent US military strikes on Iran had concluded, briefly raising hopes of renewed diplomatic talks.
She added that prolonged instability and disruptions near the Strait of Hormuz continue to threaten energy supplies from the Persian Gulf, fuelling inflation concerns and keeping the possibility of higher interest rates in focus.
The geopolitical situation intensified after US President Donald Trump warned that Iran had delayed negotiations for too long and would “have to pay the price”, as reported by The Wall Street Journal.
Following US strikes on Iranian sites near the Strait of Hormuz, Iran responded with missile and drone attacks on American bases in Jordan, Kuwait and Bahrain, further escalating tensions in the region.
Market participants are now closely tracking developments in West Asia along with upcoming US economic data for clearer signals on the Federal Reserve’s policy direction and the near-term outlook for bullion prices.
