Gold futures declined in early Friday trading with MCX gold August 5 futures falling 0.79% (₹905) to ₹1.42 lakh per 10 grams at around 9:06 AM IST, after trading in the range of ₹1,43,871 to ₹1,44,012. According to CNBC TV18, the contract had settled at ₹1,44,840 in the previous session. Silver futures also faced pressure with MCX silver September 4 contracts declining 0.75% (₹1,079) to ₹2.18 lakh per kg, touching an intraday low of ₹2,18,538 and high of ₹2,18,935, compared with the previous close of ₹2,19,967 per kg. The precious metals' decline comes amid profit-booking after recent gains and a stronger dollar, with both metals now trading lower amid fresh market pressures.
Latest retail gold prices across major Indian cities on 31 July show marginal declines due to continued uncertainty and US-Iran tensions. As per Mint, 24-karat gold rates range from ₹1,43,370 to ₹1,44,040 per 10 grams across Delhi, Mumbai, Bengaluru, Kolkata, Hyderabad, and Chennai, with Delhi recording the highest at ₹1,44,040. 22-karat gold rates are priced between ₹1,31,423 to ₹1,32,037 per 10 grams, while silver 999 fine rates range from ₹2,18,800 to ₹2,19,820 per kg. Mumbai, Kolkata, Bengaluru, Hyderabad, Kerala and Pune reported consistent rates across all purity levels, with Chennai showing slightly higher 18K gold rates at ₹11,046 per gram.
International markets showed continued weakness with COMEX gold futures down $84 per troy ounce to an intraday low of $4,076, giving up part of Thursday's $124 rally, as reported by LiveMint. Despite the decline, gold remained 1.5% higher for July, putting it on track to register its first monthly gain since February. Silver also declined $1.80 per troy ounce to $57.22, with the white metal remaining under pressure for the month and on track to end July down about 4%, marking its second consecutive monthly decline and its first back-to-back monthly loss in nearly two years. The divergent performance reflects different market dynamics with gold benefiting from safe-haven demand while silver faces selling pressure.
The latest decline in precious metals prices on MCX reflects mounting pressure from a stronger US dollar and escalating US-Iran conflict tensions. As per CNBC TV18, the US dollar rebounded from its sharpest single-day decline since January 2023, making gold more expensive for buyers using overseas currencies. Profit booking also contributed to the decline after bullion prices climbed following the US Federal Reserve's decision to keep interest rates unchanged. Recent US economic data has reinforced expectations that the Federal Reserve may proceed cautiously on future rate decisions, with softer inflation readings and signs of moderating economic growth supporting bullion. However, higher bond yields and a stronger dollar continue to cap gains, limiting sharp upside in precious metals. Market participants are likely to watch the University of Michigan's Consumer Sentiment and Inflation Expectations data and developments in West Asia for further direction in precious metal prices.
Domestic gold and silver prices are influenced by international bullion prices, the rupee's movement against the US dollar and import-related costs, as reported by CNBC TV18. India's physical gold demand remained under pressure during the April-June quarter with gold demand declining 6% year-on-year as elevated prices weighed on buying, according to the World Gold Council. However, overall consumer spending on gold touched a record high in value terms, while jewellery demand improved from the previous quarter, supported by festive and wedding-related purchases. Analysts expect movements in the US dollar, Treasury yields and developments in West Asia to remain the key drivers for gold and silver prices in the near term, with cooling US economic data lending support while a firmer dollar and elevated bond yields limit sharp upside.
