Gold and silver prices had a weak start to the week due to global geopolitical tensions, particularly after the breakdown of US-Iran talks. This has made investors more cautious, affecting the market sentiment.
As of the latest update, MCX gold dropped by Rs 1,239 to trade at Rs 1,51,413 per 10 grams, while silver experienced a more significant decline of Rs 5,986, reaching Rs 2,37,288 per kg.
The escalation of tensions in the Middle East has led to an increase in crude oil prices, raising concerns about inflation. Consequently, the likelihood of interest rate cuts by the US Federal Reserve has diminished, putting pressure on precious metals.
Gold is currently experiencing limited buying support and is moving within a narrow range, according to Ponmudi R, CEO of Enrich Money. He mentioned that a breakthrough above Rs 1,54,000 could boost sentiment and drive prices towards Rs 1,55,000. Conversely, a drop below Rs 1,51,000 could lead to further declines.
Silver is also facing selling pressure despite some industrial demand support. Ponmudi highlighted that silver is hovering above the Rs 2,38,000 mark, with resistance at Rs 2,40,000. Any recovery towards this level is expected to encounter selling pressure.
The surge in crude oil prices, surpassing $104 per barrel after the US-Iran talks collapsed, has added to market stress. This spike raises concerns about supply disruptions and global inflation, potentially delaying central bank rate cuts.
The Indian rupee is anticipated to face pressure due to the rising crude prices, impacting market sentiment alongside foreign investment flows. Experts suggest maintaining a cautious outlook, as the future direction of gold and silver prices will heavily rely on geopolitical developments, oil price movements, and global investor reactions in the upcoming days.