Gold and silver prices saw a decline on Monday due to the strengthening of the US dollar following in-line US inflation data. MCX gold April futures fell by 0.56% to Rs 1,55,023 per 10 grams around 12.30 am on an intra-day basis. Similarly, MCX silver March futures dropped by 1.99% to Rs 2,39,501 per kg.
The dollar index rose by 0.10% to 97, reflecting the moderation in US CPI in January. This index had earlier gained support from robust jobs data, indicating a healthy underlying economy. A stronger dollar resulted in higher prices for greenback-priced bullion for holders of other currencies.
In January, the US CPI increased by 0.2% after a 0.3% rise in December. The annual US inflation rate for January stood at 2.4%, down from the previous month’s 2.7%. With the in-line inflation data and positive jobs growth, the US Fed may opt to maintain interest rates at their current levels.
According to an analyst, gold is supported at Rs 1,54,000 and Rs 1,53,150, with resistance at Rs 1,56,800 and Rs 1,58,200. For MCX silver, support levels are at Rs 2,38,800 and Rs 2,32,000, while resistance is at Rs 2,49,100 and Rs 2,55,000.
Analysts noted that the overall trend in precious metals remains positive due to geopolitical tensions, strong central bank purchases, and investor movement away from sovereign bonds and currencies.
Market participants mentioned that COMEX Silver is trading in the $73–$84 range after a significant correction from its peak above $121. Although the long-term bullish outlook remains intact, recent price drops below key moving averages suggest short-term bearish pressure and an extended corrective phase.
Investors are eagerly awaiting the release of the Federal Open Market Committee (FOMC) meeting minutes, the US GDP advance estimate, and PCE inflation data to gain insights into the future interest rate path of the US Fed. Additionally, they are monitoring crude oil price movements based on developments in US-Iran talks and efforts to resolve the Russia-Ukraine conflict.
