Gold and silver prices continued their recent slide in India. On MCX, February futures were down 0.51% to 39,345 per 10 gram, tracking a decline in global rates. Silver prices on MCX fell 0.82% to 46,060 per kg. Gold prices have seen a sharp fall after hitting a new high of 41,293 in the previous week. "Gold can dip lower towards 39,100 while taking resistance near 39,600 while silver can test 45,800 while taking resistance near 46,300," SMC Global said in a note.

In global markets, gold prices dropped sharply today as the risk appetite increased after the US dropped China's designation as a currency manipulator ahead of an interim deal signing between the two countries. Global equities rallied to new highs, pushing spot prices down 0.7% to $1,537.67 per ounce.

"De-escalation of US-Iran tensions and rising optimism over the US-China trade deal have reduced the risk premium on gold," said Abhishek Bansal, chairman of ABans Group of Companies.

A top US official said details of the trade deal will be public on Wednesday, just prior to a signing ceremony. Also weighing on gold is a steady dollar, making gold expensive for holders of other currencies.

The dollar is gaining strength and also weighing on gold prices, said Mr Bansal.

Among other precious metals, silver prices declined 1% to $17.79 per ounce, while platinum slipped 0.6% to $967.78.

Back in India, the commerce ministry has sought a significant reduction in the import duty on gold in the forthcoming budget, news agency Press Trust of India reported, citing sources. Gold prices in India includes 12.5% import duty and 3% GST.

The latest tranche of sovereign gold bonds (2019-20 - Series VIII) has opened for subscription. The issue closes on 17th January. It is priced at at 4,016 per gram of gold. Investors applying online and making payment online get a discount of 50 per gram. So for such investors, the issue price of gold bond will be 3,966 per gram of gold. In terms of taxation, capital gains at maturity is tax-free. This is an exclusive benefit available on gold bonds. (With Agency Inputs)

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