Gold prices witnessed a significant decline for the second consecutive session, falling by Rs 1,250 to Rs 78,150 per 10 grams in the national capital on Tuesday. The drop comes as the US dollar continues to strengthen, reducing the appeal of gold as a safe haven asset in the global markets.
According to the All India Sarafa Association, gold of 99.9 per cent purity had closed at Rs 79,400 per 10 grams on Monday, reflecting a Rs 1,000 decrease from the previous day. Gold of 99.5 per cent purity also saw a Rs 1,250 drop, settling at Rs 77,750 per 10 grams, compared to Rs 79,000 on Monday.
Silver prices followed suit, falling by Rs 1,100 to Rs 90,600 per kg on Tuesday. In the previous session, silver had closed at Rs 91,700 per kg, marking a decline of Rs 1,600.
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“Gold remained volatile, trading between $2,610–$2,630 on Comex and Rs 74,850–Rs 75,500 on MCX, as de-escalation in Middle East tensions led to the fading of the war premium. The metal erased 2.5–3.0% of last week’s strong gains. In the short term, gold is expected to stay within a volatile trading range as market participants assess global developments.” said Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities
Market analysts pointed to a combination of factors driving the drop in gold prices. US President-elect Donald Trump’s threat to impose additional tariffs on imports from China, Mexico, and Canada has spurred a surge in demand for the US dollar, making gold less attractive. At the same time, easing geopolitical tensions in the Middle East have reduced gold’s role as a safe-haven investment.
Meanwhile, in futures trading on the Multi Commodity Exchange (MCX), gold contracts for December delivery rose by Rs 175, or 0.23 per cent, to Rs 75,486 per 10 grams, after settling at Rs 75,311 on Monday. Silver contracts for December delivery, however, rose by Rs 698, or 0.8 per cent, to Rs 88,397 per kg, recovering some of its losses from the previous session.
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