New Delhi: Gold prices are expected to remain highly sensitive this week as investors closely watch developments in West Asia, movements in crude oil prices and a series of important economic data releases across major economies.
Market participants will monitor trade and inflation figures from China and the United States, along with consumer sentiment data from Washington and India's Consumer Price Index (CPI) numbers. The European Central Bank's latest monetary policy decision will also remain in focus.
Precious Metals End Week Lower
Gold and silver prices closed the previous week with sharp losses in both domestic and international markets.
On the Multi Commodity Exchange (MCX), gold futures for August delivery fell by Rs 5,317, or 3.3 per cent, to around Rs 1.55 lakh per 10 grams. Silver futures for July delivery declined by Rs 18,461, or 7 per cent, to Rs 2.48 lakh per kilogram.
In international markets, Comex gold futures dropped nearly 5 per cent during the week to USD 4,365 per ounce. Silver prices also fell sharply, losing almost 9 per cent to USD 69.10 per ounce.
Oil Prices and Strong Dollar Weigh on Gold
According to analysts, rising crude oil prices shifted investor attention away from traditional safe-haven assets such as gold.
Jateen Trivedi, VP Research Analyst at LKP Securities, said the strengthening of the Indian rupee against the US dollar added further pressure on domestic gold prices. A stronger rupee reduces the cost of imported gold, often limiting gains in local bullion markets.
Economic Data Remains Key
Pranav Mer of JM Financial Services said precious metals are currently witnessing a corrective phase. Stronger-than-expected US manufacturing and labour market data have increased expectations that interest rates may stay higher for longer.
Analysts also noted that signs of a possible easing in the Russia-Ukraine conflict have reduced safe-haven demand for gold.
Going forward, bullion prices are likely to take cues from inflation readings, central bank actions, geopolitical developments and crude oil trends. Analysts believe a firm rupee and elevated oil prices could limit any sharp recovery in gold and silver.
