Gold rates in India witnessed significant volatility on Tuesday, with MCX gold prices declining further to hit below ₹1.49 lakh mark as the market faces continued pressure from a stronger US dollar and rising Treasury yields. MCX gold futures for December 2026 delivery dipped by ₹415 to ₹1,49,901 per 10 grams, extending the decline over two days to a total drop of ₹1,500 per 10 grams. 24-carat gold currently stands at ₹1,49,180 per 10 grams, while 22-carat gold retails at ₹1,36,750 per 10 grams and 18-carat gold at ₹1,11,890 per 10 grams. Spot gold is hovering around $4,135 an ounce after losing more than 3% last week and about 6% over the past month, according to Ashish Rajodiya, Head - Commodities, PL Capital. Gold futures on Comex were trading near $4,150 per ounce, while silver was trading near $61 per ounce in global markets. Gold prices in India are broadly steady on Monday, with gold broadly down in October so far, having dropped nearly 3% in September alone.
The dollar remained firm, making gold and other greenback-denominated commodities more expensive for holders of other currencies, according to The Economic Times. Yields on 10-year and 30-year US Treasury bonds climbed to 24-year highs on Monday as continued weakness in the bond market weighed on sentiment. Expectations of a US rate hike in October eased after data on Friday showed US job growth slowed more than expected in September and nonfarm payrolls for the prior two months were revised lower. Traders are pricing an 87% probability of a rate increase in December, according to CME's FedWatch Tool, though this has provided some relief to precious metals markets. Higher interest rates raise the opportunity cost of holding non-yielding gold, limiting the appeal of the safe-haven asset. Data showed US services sector activity slowed in September, while strong domestic demand stretched supply chains and pushed a measure of prices paid by businesses for inputs to its highest level in more than four years, suggesting inflation could remain elevated into 2027.
The Reserve Bank of India's 3-day policy meeting begins from October 5th to end on October 7th, with policy decisions to be declared on Wednesday. RBI has kept policy repo rate unchanged at 5.25% since December 2025, and if RBI hikes rate on Wednesday, it will be first in 10 months. A 25 basis point increase in the repo rate is increasingly being expected, which would take the rate from 5.25% to 5.50%, according to Saurabh Jain, Co-Founder & CEO, Stable Money. The October MPC meeting will be closely watched as inflation moving higher in recent months and pressures becoming more broad-based. Friday's weak US jobs report, with payrolls up just 29,000 against expectations of 90,000 and unemployment edging up to 4.2%, has pushed the odds of an October Fed rate hike down to about 18%, from near 70% earlier in the week, though this relief has done little for bullion due to elevated treasury yields.
Gold futures opened lower on the MCX, with the benchmark December gold contract opening ₹388 lower at ₹1,48,928 per 10 gram and trading ₹150 lower at ₹1,49,166 at the time of writing. Gold futures had touched a high of ₹1,80,779 per 10 gram earlier this year. According to Ajay Kedia, director, Kedia Advisory, selling pressure has again increased in gold from a technical perspective. Open interest rose 2.3 per cent to 16,322, while prices fell by ₹1,074, indicating fresh bearish participation in the market. Gold currently has support at ₹1,48,385, with a sustained fall below this level potentially taking prices towards ₹1,47,445. On the upside, resistance is seen at ₹1,50,730, with a decisive move above this level helping gold recover towards ₹1,52,135. Silver futures also opened lower, with the benchmark December silver contract opening ₹960 lower at ₹2,25,127 per kg and trading ₹486 lower at ₹2,25,601 at the time of writing. Silver futures had touched a high of ₹4,20,048 per kg earlier this year. Kedia noted that silver was witnessing short covering from a technical perspective, with open interest falling 0.81 per cent to 16,450, while prices rose by ₹210, indicating some fresh buying after the recent weakness.
Central banks purchased 289 tonnes of gold in the second quarter of 2026, while full-year purchases are estimated at 700–900 tonnes, compared with a pre-2022 annual average of around 400–500 tonnes, according to Tata MF. The World Gold Council confirmed that central banks and other official institutions bought a net 289 tonnes of gold in Q2 2026, up 62% from 177.9 tonnes in the same quarter of 2025, with Q2 purchases being the highest for any second quarter on record. The World Gold Council also reported that 45% of central-bank respondents intended to increase their gold reserves over the next 12 months. China and Poland were among the major buyers, with Poland adding 82 tonnes, Uzbekistan 41 tonnes and China 40 tonnes at the end of the first half of 2026, according to World Gold Council data. Chinese gold imports have crossed 1,000 tonnes in 2026, already exceeding the full-year volume for 2025, with retail demand, ETF inflows and central bank purchases supporting the country's physical gold market.
