Gold prices today fall for sixth time in 7 days, silver rates plunge

Gold and silver prices edged lower in Indian markets today after posting strong gains in the previous session. On MCX, October gold futures were down 0.22% to ₹51,665 per 10 gram. Silver futures fell 1% to ₹66,821 per kg. In the previous session, gold had rebounded, snapping a five-day losing streak. Gold futures had surged ₹900 per 10 gram while silver had jumped ₹3,500 per kg.

In global markets, gold prices were steady after posting strong gains in the previous session. Spot gold was steady at $1,952.11 per ounce, supported by a weaker US dollar. Among other precious metals, silver dropped 0.8% to $27.30 per ounce, platinum rose 0.6% to $934.29.

The dollar index fell 0.2% to a near one-week low against its rivals, making gold less expensive for holders of other currencies. Gold traders are awaiting a speech from Federal Reserve Chairman Jerome Powell due later in the day for more insight on the US central bank's strategy on inflation and monetary policy. The bank has provided crucial support worth trillions of dollars to the world's top economy during the virus crisis, helping stocks bounce back from their March troughs.

Meanwhile, the holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund or ETF, said its holdings rose 0.3% to 1,252.09 tonnes on Wednesday.

Further supporting gold prices, geopolitical concerns returned after Beijing fired missiles into the South China Sea and the US sanctioned several Chinese firms linked to the disputed region.

Meanwhile, reports said that Republicans in the U.S. Congress are working on a narrow coronavirus stimulus bill that could be circulated to lawmakers as soon as this week. Gold tends to benefit from widespread stimulus measures from central banks because it is widely viewed as a hedge against inflation and currency debasement.

However, weighing on gold price is weaker consumer demand as is evident from discounts in Indian and Chinese markets, says Kotak Securities. "Gold may continue to witness choppy trade unless we get more clarity on Fed’s stance and thereby trend in US dollar however we may see buying interest emerging at lower levels amid persisting virus concerns, growth worries and US-China differences over various issues," the brokerage added. (With Agency Inputs)