Gold and Silver Prices Plummet as Profit Booking Hits MCX Despite Escalating Iran Tensions

Gold and Silver Prices Plummet as Profit Booking Hits MCX Despite Escalating Iran Tensions​

Gold and silver prices opened lower on the Multi Commodity Exchange (MCX) on Friday, following a sharp rally over previous sessions. The decline came despite sustained global demand for precious metals, coupled with geopolitical instability stemming from heightened tensions between Washington and Tehran. Investors are booking profits after recent aggressive price surges across the precious metal spectrum.

Domestic Precious Metal Declines on Profit Booking​

The domestic market saw significant corrections in commodity futures. MCX silver futures for September 2026 delivery were down by Rs 2,537, settling at Rs 2,32,910 per kg. Gold futures for October 2026 delivery also declined, falling by Rs 1,162 to reach Rs 1,52,304 per 10 grams.

In terms of performance over the last two days, silver has seen a decline of Rs 5,000, while the yellow metal has fallen by Rs 2,600/gram. These movements reflect market participants taking gains after strong appreciation in recent sessions.

Global Trends and International Metal Prices​

Globally, spot gold was down 0.5% at $4,330.37 per ounce as of 0103 GMT, while US gold futures for December delivery fell slightly to $4,386.80. The bullion touched its highest level since June 5 on Thursday before closing the session 1.3% lower, thus wiping out earlier weekly gains.

Spot silver also saw a downturn, falling 0.8% to $63.92 per ounce. Other precious metals experienced declines as well; platinum slipped 1% to $1,700.60, while palladium fell 0.3% at $1,303.25. Both platinum and palladium are noted to be at their lowest levels since August 4.

Geopolitical Shifts and Macroeconomic Signals​

The market action occurs against a backdrop of mounting geopolitical risk. Washington threatened to maintain a naval blockade of Iran indefinitely on Thursday, increasing economic pressure on Tehran as diplomatic ceasefire talks remain stalled.

In macroeconomic terms, US producer prices remained unchanged in July, which was attributed to declining goods prices and a marginal rise in the cost of services. This data strengthened expectations that the Federal Reserve might leave interest rates unchanged next month, following previous mild consumer inflation reports.

Expert Viewpoint on Gold and Silver Trading Strategy​

Analysts suggest that profit booking remains a key factor influencing MCX movements. Jigar Trivedi of IndusInd Securities noted that Rs 1,54,000/per gram is supporting the trend for MCX Gold for the day. For silver, the market still shows strong investment demand, and MCX Silver September could potentially rise to Rs 2,40,000 per kg, though profit booking remains a possibility.

International interest in gold has remained firm, with political and economic developments supporting global investor appetite. The Bank of Korea demonstrated significant commitment by holding 6,79,765 shares of SPDR Gold Trust, valued at around $250.4 million at the end of June. This marks its first disclosed gold investment since it acquired physical gold in 2013.

Physical Gold Rates Across Major Cities​

Gold rates for the physical market remain stable across major metropolitan areas. In Delhi, standard gold (22 carat) prices stand at Rs 1,12,752/8 grams, while pure gold (24 carat) is priced at Rs 1,22,992/8 grams.

In Mumbai, the pricing mirrors this trend with standard gold at Rs 1,12,632/8 grams and pure gold priced at Rs 1,22,872/8 grams. Chennai reports standard gold (22 carat) at Rs 1,13,768/8 grams, and pure gold at Rs 1,24,112/8 grams. Hyderabad also shows standard gold (22 carat) at Rs 1,12,632/8 grams, with pure gold priced at Rs 1,22,872/8 grams.