Gold and silver prices saw a decline on Tuesday due to profit booking, following a recent surge to record highs triggered by concerns regarding the US Justice Department’s actions against the Federal Reserve Chair. The MCX gold February futures dropped by 0.44% to Rs 1,41,400 per 10 grams around 1.15 pm, while MCX silver March futures remained flat with a slight negative bias at Rs 2,68,926 per kg.
The price of 24-carat gold for 10 grams stood at Rs 1,40,482, down from the previous day’s close at Rs 1,40,499, as reported by the India Bullion and Jewellers Association (IBJA). Gold prices had surpassed $4,600 per ounce for the first time ever, prompting investors to take profits.
The rally in prices was bolstered by US President Trump’s announcement of a 25% tariff on nations trading with Iran and his warnings of potential military actions amidst escalating protests. Market attention remains on the criminal investigation into Fed Chair Jerome Powell’s testimony, which he labeled as politically motivated pressure to induce rate cuts, according to Rahul Kalantri, VP Commodities, Mehta Equities Ltd.
Investors are also monitoring key US inflation data for a clearer policy direction. Although rates are anticipated to remain steady this month, markets are factoring in two cuts later in the year, analysts noted. Last week’s US jobs report, indicating weaker-than-expected payroll gains, reinforced expectations of further interest-rate cuts by the Federal Reserve in the coming months.
Concerns over political unrest in Iran and its potential impact on oil supplies have influenced market sentiments. Additionally, ongoing conflicts such as Russia’s war in Ukraine and Washington’s hints at assuming control of Greenland are contributing factors to the current market rally.
Analysts pointed out that gold has support levels at Rs 1,39,550-1,37,310 and resistance levels at Rs 1,44,350-1,46,670, while silver’s support is at Rs 2,60,810 to 2,54,170 and resistance at Rs 2,71,810 to 2,74,470. Silver is maintaining a strong structural bias, with medium-term targets expected to exceed $100 by 2026, driven by persistent supply deficits and increasing demand from industrial and green-energy applications.
