Gold Plummets ₹1,400 as Rupee Strength and Global Tension Overshadow Precious Metal Demand
The price of gold experienced a significant decline in the national capital on Tuesday, falling by ₹1,400 to reach ₹1,49,250 per 10 grams (inclusive of all taxes). This steep drop coincided with silver easing by ₹200. The depreciation was attributed primarily to a strengthening rupee and prevailing weak global trends across precious metals markets.Domestic Bullion Faces Pressure Amid Rupee Appreciation
The yellow metal of 99.9 percent purity settled at ₹1,49,250 per 10 grams, down from Monday’s closing price of ₹1,50,650 per 10 grams. Simultaneously, silver prices slipped to ₹2,39,800 per kilogram (inclusive of all taxes), a reduction from the previous session's rate of ₹2,40,000 per kg.Analysts noted that domestic bullion faced significant pressure due to the rupee appreciating sharply against the US dollar. Jateen Trivedi, VP Research Analyst at LKP Securities, stated that the gold price decline was driven by the currency movement.
International Markets See Gold and Silver Decline
In global trade, spot gold fell $24.54, marking a 0.59 percent decrease to $4,140.59 per ounce. Silver also declined by nearly 2 percent, trading at $60.89 per ounce.Praveen Singh, Head of Commodities at Mirae Asset ShareKhan, pointed out that overseas gold is trading lower amid heightened geopolitical concerns. The instability surrounding attacks on shipping in and around the Strait of Hormuz has created uncertainty over the safety of vessels traversing the Persian Gulf.
Geopolitical Tensions Elevate Global Rates
The security risks associated with the region have led crude oil prices to stage a minor rebound, lifting them by more than 1 percent. This development, along with strengthening US Treasury yields and the dollar index, exerted downward pressure on precious metals.The rupee’s strength was also reinforced as Saudi Arabia reduced crude oil prices for Asian buyers, which eased concerns regarding India's import bill.
Market Awaits Key Economic Data for Direction
Precious metal investors are currently maintaining a cautious stance as markets await several key economic data releases. Saumil Gandhi, Senior Analyst - Commodities at HDFC Securities, noted that the market is holding steady before the release of the Federal Reserve’s June meeting minutes and the second round of US-Iran peace talks.Kaynat Chainwala, AVP Commodity Research at Kotak Securities, confirmed that traders are awaiting the Federal Open Market Committee meeting minutes, the ADP report, initial jobless claims, and next week's US inflation data for clearer market direction.
Near-Term Outlook: Range-Bound Trading Expected
Praveen Singh provided an outlook suggesting that precious metals are likely to remain range bound in the immediate term. He added that a positive trend could re-emerge if geopolitical tensions within West Asia can be effectively contained.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
The information provided is for general informational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any securities. Readers are advised to rely on their own assessment and judgment and consult appropriate financial advisers, if required, before taking any investment-related decisions.
Any views, opinions, or statements expressed, where applicable, are those of the respective analysts or experts and do not reflect the views of this website. The website has no association with such viewpoints and does not assume any responsibility for them.