Gold Futures Extend Losses in Domestic Market
New Delhi, March 24Gold prices continued their downward trend on Tuesday, declining by Rs 2,260 to Rs 1.37 lakh per 10 grams in futures trading, marking the fifth consecutive session of losses amid ongoing uncertainty surrounding geopolitical developments in West Asia.
On the Multi Commodity Exchange (MCX), gold futures for April delivery fell by Rs 2,260, or 1.62 per cent, to Rs 1,37,000 per 10 grams.
Sharp Volatility Seen in Previous Session
The precious metal has witnessed significant volatility in recent sessions. On Monday, gold prices had plunged by Rs 14,897, or 10.3 per cent, touching an intraday low of Rs 1,29,595 per 10 grams before partially recovering to settle at Rs 1,39,260 per 10 grams on the MCX.Global Gold Prices Also Under Pressure
In the international market, gold futures for the April contract declined by USD 62.4, or 1.42 per cent, to USD 4,344.9 per ounce.Prices hovered near the USD 4,300 per ounce level, reflecting continued pressure in global markets.
West Asia Tensions Drive Market Sentiment
Gold prices remained under strain due to conflicting developments in West Asia. Iran denied engaging in talks with Washington to resolve the ongoing conflict, while geopolitical tensions escalated further.Earlier, the US President Donald Trump had postponed planned military strikes on Iranian energy infrastructure and indicated that negotiations were underway, which initially supported a rebound in gold prices.
However, Tehran rejected these claims and described them as an attempt to influence financial markets. The situation intensified as Iran launched fresh attacks on US targets, while Israel continued its strikes against Iran.
Inflation Risks and Energy Concerns Weigh on Gold
According to market participants, the evolving geopolitical situation has created uncertainty around the Strait of Hormuz, raising concerns over potential supply disruptions in global energy markets. This has kept inflation risks elevated.Gold has also seen a sharp correction from its March peak, declining by as much as 25 per cent, as rising energy prices strengthened expectations of interest rate hikes by central banks.
Outlook Hinges on Global Cues and Economic Data
Market sentiment remains cautious, with gold futures trading under a negative undertone in global markets.Investors are now closely watching upcoming macroeconomic data, including US ADP employment figures and Purchasing Managers' Index (PMI) data, for further clarity on the Federal Reserve’s stance on interest rates.
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