Gold prices showed marginal recovery on Wednesday, with international spot gold trading with a 0.42% increase to $4,022.60 per ounce during early trade, as reported by Moneycontrol. Silver traded flat at $57.97 per ounce during morning trade on Comex. Domestic MCX gold futures for the August contract increased 0.6% to ₹1,41,144 per 10 grams, while silver futures for the September contract inched 0.59% to ₹2,19,005 per kilogram from their previous close. The recovery comes after spot gold had fallen 0.4% to $4,060.46 per ounce in the previous session, setting a one-week low. Latest developments show COMEX Gold was trading at $4,004 per ounce, down 0.04%, while COMEX Silver fell 1.06% to $57.355 per ounce in early trade on Tuesday, as reported by CNBC TV18.
Market participants are now awaiting the US CPI inflation data due this evening, which will be a key input for the Federal Reserve's interest rate outlook and could determine the next direction for bullion, as reported by Moneycontrol. A higher-than-expected inflation reading may strengthen the dollar further and keep pressure on gold, while softer inflation could support a recovery, according to Jateen Trivedi, VP Research Analyst at LKP Securities. The International Monetary Fund on Wednesday lowered its 2026 global growth forecast again to 3.0%, adding to concerns about economic growth and inflation. Market analyst Kelvin Wong from OANDA noted that the temporary ceasefire agreement between U.S. and Iran is now on shaky ground, potentially leading to further escalation. According to The Times of India, the latest escalation between the US and Iran has renewed concerns over energy supplies after Tehran announced the closure of the Strait of Hormuz following an attack on a vessel it claimed was travelling through an unauthorised route.
According to The Hindu BusinessLine, markets are now pricing a 68% chance of an interest rate hike in September and see an 87% chance of an increase in January 2027, as shown by the CME FedWatch tool. Markets turned more cautious after US Federal Reserve Governor Christopher Waller indicated that the central bank may need to raise interest rates if inflation remains above its 2% target, as reported by CNBC TV18. Higher interest rates typically reduce the appeal of non-yielding assets such as gold. However, Khoo added that any loss of confidence in the central bank's credibility could revive demand for gold as a safe-haven asset over the longer term. The International Monetary Fund on Wednesday lowered its 2026 global growth forecast again to 3.0%, adding to concerns about economic growth and inflation. Market participants will closely monitor a series of key US economic indicators, including retail sales, housing data and weekly jobless claims, for further clues on the Federal Reserve's policy path.
Technically, MCX Gold has immediate support near ₹1,40,000–1,40,500, while ₹1,44,500 remains the key resistance zone in the near term, according to Jateen Trivedi, VP Research Analyst at LKP Securities. The latest price movement reflects renewed market concerns about geopolitical tensions and their potential impact on monetary policy. Latest developments show COMEX gold futures slipped USD 12, or 0.3 per cent, to end at USD 4,113.7 per ounce in New York, while silver fell 1.5 per cent, to USD 60.16 per ounce, as reported by Business Standard. Gold witnessed another subdued week, declining more than 2 per cent, as a combination of a stronger US dollar, firm crude oil prices, and expectations of higher interest rates continued to weigh on investor sentiment, said Jateen Trivedi. The Indian rupee also witnessed a mild correction, which offered limited support to MCX gold, with the impact of currency weakness largely offset by bearish global sentiment.
Bank of America said it is reducing its 2026 average gold forecast by 14% to $4,360 an ounce, citing a more hawkish Federal Reserve stance, as reported by The Hindu BusinessLine. The revision reflects growing concerns about high inflation at the U.S. central bank's meeting last month, where officials followed Fed Chairman Kevin Warsh's lead to a more stripped-down policy statement amid concerns that price increases were broadening and might require interest rate hikes. This more aggressive stance is weighing on gold's appeal as an inflation hedge, even as the precious metal is seen as an inflation hedge. Kaynat Chainwala from Kotak Securities noted that bullion has been witnessing sharp two-way moves as markets react to every development in the West Asia conflict, with gold and silver recovering from recent lows after reports suggested Iran had reached out to Washington seeking a peace deal, but the recovery remained limited as investors also weighed the Fed's cautious stance and persistent inflation risks.
