SRINAGAR: Gold and silver prices declined in domestic futures trade on Tuesday as a stronger dollar and easing trade tensions between the United States and China reduced the appeal of safe-haven assets.
On the Multi Commodity Exchange (MCX), gold futures for December delivery fell by Rs 836, or 0.69 per cent, to Rs 1,20,573 per 10 grams in a business turnover of 13,332 lots. Silver futures for December delivery also dropped by Rs 1,558, or 1.05 per cent, to Rs 1,46,200 per kilogram in 20,939 lots.
The dollar index, which measures the greenback’s strength against six major currencies, rose 0.08 per cent to 99.95, exerting pressure on bullion prices.
Globally, Comex gold futures for December delivery traded lower at USD 3,994.81 per ounce, down USD 19.19, or 0.48 per cent, as investors priced in reduced chances of another rate cut by the US Federal Reserve. Comex silver futures also slipped 0.62 per cent to USD 47.75 an ounce, marking their third consecutive day of losses.
“Gold hovered around the USD 4,000 mark as the dollar remained firm near a three-month high. The easing of US-China trade tensions and lower probability of a Fed rate cut in December weighed on demand,” said Manav Modi, Analyst – Precious Metals Research, Motilal Oswal Financial Services Ltd.
Fed officials have offered mixed views on the state of the US economy, with uncertainty heightened by the ongoing federal government shutdown, which has delayed key economic data releases.
Jigar Trivedi, Senior Research Analyst at Reliance Securities, said investors are now awaiting US private payroll data due later this week for further cues on the Fed’s policy path. “With the trade truce between the US and China easing geopolitical concerns, safe-haven demand for gold has softened,” he noted.
Analysts expect bullion prices to remain under pressure in the near term as markets assess the impact of a resilient dollar, improving trade sentiment, and mixed signals from the US economy ahead of critical data releases.
