New Delhi: Gold prices fell Rs 600 to Rs 1,66,500 per 10 grams in Delhi, ending a four-session winning streak as investors booked profits after the recent rally.
The precious metal of 99.9 percent purity had settled at Rs 1,67,100 per 10 grams in the previous trading session, according to the All India Sarafa Association.
The fall followed weakness in overseas markets and a stronger US dollar ahead of important American inflation data.
Silver edges higher
Silver moved in the opposite direction, rising Rs 500 to Rs 2,50,500 per kilogram, inclusive of all taxes. It had closed at Rs 2,50,000 per kilogram in the previous session.
Despite the domestic increase, silver remained under mild pressure in international markets.
Profit booking weighs
Market experts said investors booked profits after gold’s strong rise over several weeks. Expectations surrounding the US Personal Consumption Expenditures inflation report also strengthened the dollar and reduced demand for bullion.
A stronger dollar generally makes gold more expensive for buyers using other currencies, which can weaken international demand.
Gold has reached several multi-month highs this year, supported by lower US bond yields, steady purchases by China’s central bank and the US Treasury’s expanding debt-buyback programme.
Global prices decline
In overseas markets, spot gold declined $39.66, or nearly 1 percent, to USD 4,619.21 an ounce. The metal entered a consolidation phase after advancing for five consecutive sessions.
International silver prices also slipped marginally to USD 68.50 an ounce.
Crude oil extended its decline as supply concerns eased. Iran and Oman continued efforts towards a temporary opening of the Strait of Hormuz, reducing some geopolitical risk premiums.
Meanwhile, holdings in gold-backed exchange-traded funds have increased sharply over recent weeks, indicating continued investor interest in the safe-haven asset.
Focus shifts to US Fed
The bullion market will now closely track signals on US inflation and monetary policy. Any change in interest-rate expectations could influence the dollar, Treasury yields and precious-metal prices.
Investors are also awaiting US Federal Reserve Chair Kevin Warsh’s speech at the Jackson Hole Symposium on Friday for further policy guidance.
