Gold and silver prices saw a decline for the second consecutive day on Tuesday, influenced by mixed US economic data and anticipation regarding the US Federal Reserve’s policy direction. MCX gold April futures fell by 0.56% to Rs 1,53,889 per 10 grams during the day, while MCX silver March futures dropped by 1.18% to Rs 2,37,064 per kg. Analysts noted that investors are uncertain about whether lower inflation figures will lead to looser monetary policy or if robust labor market data will maintain higher interest rates.
The dollar index rose by 0.21% to 97.12, following a decrease in US CPI (consumer price index) in January. This increase in the dollar’s value made gold more expensive for holders of other currencies. Internationally, spot gold fell below $5,000 to $4,992 per ounce, and spot silver decreased by nearly 3%. The decline in prices was attributed to US consumer prices rising less than anticipated in January, despite surprising job growth, creating uncertainty around potential rate cuts in the near future.
Analysts mentioned that COMEX Gold is trading between $4,850 and $5,100 after a significant drop from recent highs above $5,500–$5,600. Furthermore, a reduction in geopolitical tensions led to decreased safe-haven demand for gold, with an Iranian diplomat expressing Iran’s interest in a nuclear agreement with economic benefits for both Iran and the US. Analysts highlighted key support levels for gold and silver, along with resistance levels, indicating the broader positive trend in precious metals due to geopolitical concerns, central bank purchases, and investor movement away from sovereign bonds and currencies.
Investors are closely monitoring various factors such as global liquidity conditions, US dollar fluctuations, bond yields, progress in US-Iran discussions, and efforts to resolve the Russia-Ukraine conflict.
