Gold rates in India today near lowest in a month, silver prices slump

Gold in India prices were near the lowest in a month as the yellow metal remained under pressure. On MCX, gold futures were down 0.23% to ₹51,132 per 10 gram while silver futures were down 0.5% to ₹54,988 per kg. In global markets, gold slipped today as the US dollar strengthened. Spot gold fell 0.2% to $1,734.59 per ounce. The dollar index rose 0.1%, after easing off a two-decade peak hit on Monday.

Analysts say in the short term, gold prices will be continued to be driven by sentiment in the dollar. Spot silver fell 0.4% to $18.66 per ounce in global markets.

Ravindra Rao, VP- Head Commodity Research at Kotak Securities, said: "COMEX gold is mixed near $1750/oz as US dollar index is off the highs while US bond yields have stabilized. The US dollar index has corrected from 2002 highs as Fed’s hawkish comments are countered by hawkish comments from ECB officials. Some pause in equity market sell-off has also affected US dollar’s safe haven appeal. Gold may remain choppy as market players continue to react to US economic numbers and Fed comments however Fed’s hawkish stance may keep US dollar supported which may keep pressure on gold prices.”

Despite weakness in the yellow metal, investor interest remained weak. The holdings in SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, fell 0.4% to 980.61 tonnes on Monday.

Pritam Patnaik, Head - Commodities, HNI and NRI Acquisitions, Axis Securities, said: “Profit booking in the greenback led to a brief respite in gold prices in yesterday’s day of trade. The US dollar retreated against the euro, as the ECB indicated that it will continue with more aggressive rate hikes, than initially thought. The prospects for gold don’t look too bright as an extremely hawkish Fed is going to go ahead with its aggressive rate hike plans, with an aim to bring inflation close to 2%, which is still a long way off. They seem to have sacrificed economic growth for inflation control, which says a lot about their resolve.”

"Despite weakness witnessed in stock and currency markets, gold has seen limited inflows as a safe haven. But this could change, if the economic outlook worsens, providing some support to prices. Considering the future hike will be data driven, all positive data points will lead to higher probability of a hike and put pressure on bullion," he added. (With Agency Inputs)