Gold rates today drop for fifth day in a row, down over ₹1,000 this week

Gold prices remained weak in domestic markets, sliding for the fifth day in a row. On MCX, gold futures were down at ₹50838 per 10 gram after rising to nearly ₹52,000 at the start of the week. Silver futures edged higher to ₹57,304 per kg.  In international markets, gold slipped as US inflation data boosted possibility of another jumbo-sized Federal Reserve interest rate hike next month. Spot gold fell 0.3% to $1,660.10 per ounce.

Although gold is vulnerable to more corrective moves amid Fed’s aggressive stance to tame inflation, geopolitical tensions and global slowdown concerns might support the prices at lower levels, say analysts.  Spot silver dipped 0.3% to $18.81 per ounce. In international markets, gold is down about 1.5% so far this week.

Data released on Thursday showed US consumer prices increased more than expected in September, with core CPI jumping 6.6% on an annual basis. Although traditionally considered an inflation hedge, interest rate hikes to combat soaring prices have reduced bullion's appeal since it yields no interest.

Despite gold correcting from $2,000 levels in March, investor interest remains weak. Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.12% to 944.31 tonnes on Thursday.

According to analysts, gold may remain in range of  $1,660 to $1,674 per ounce in the near term and any break of either levels could put the yellow metal in that direction. The bulls have failed to keep the price above the $1700/oz mark as price pressure is keeping Fed on its aggressive rate hike path.

“Silver has been taking cues from both gold and industrial metals that have been trading with a weaker bias. On the price action front $ 18.60/oz would act as a good support. A break below the support would bring further selling. The reversal of the current corrective move might happen only if the bulls succeed in keeping it above $20/oz. Till the said support resistance holds we expect a range bound move in silver prices.” Kotak Securities said in a note. 

Among other commodities, oil prices reversed earlier losses and inched up today, supported by a weaker US dollar. Brent crude futures rose 29 cents, or 0.3%, to $94.86 per barrel. (With Agency Inputs)