Gold prices took a significant hit on Friday, falling by Rs 750 to Rs 75,650 per 10 grams in the local market, marking the end of a six-day winning streak. This decline mirrors a global trend of subdued demand and weaker market signals.
The All India Sarafa Association reported that the precious metal had previously closed at Rs 76,400 per 10 grams. Gold with 99.5 percent purity also saw a decline of Rs 800, settling at Rs 75,300 per 10 grams from Rs 76,100 the previous day.
Silver Prices Also Decline
The downturn wasn’t limited to gold. Silver prices plummeted by Rs 1,000, reaching Rs 93,000 per kilogram. The metal had closed at Rs 94,000 per kilogram in the previous session.
Causes of the Decline
Traders attributed the dip in gold prices to a combination of weak international market trends and decreased demand from jewellers within India. On the global stage, Comex gold was trading lower at USD 2,414.60 per ounce, a drop of USD 41.80 from the previous day.
“Comex gold continued to trade lower for the third consecutive session on Friday, pressured by the recovery in the US dollar from four-month lows and an increase in US 10-year treasury yields,” said Kaynat Chainwala, AVP of Commodity Research at Kotak Securities.
Chainwala also highlighted profit-taking by investors near all-time highs, along with concerns over the ongoing tariff war with China and other geopolitical issues, as contributing factors. Despite the growing likelihood of interest rate cuts, these factors have overshadowed the market.
Impact of Swiss Gold Exports
According to customs data, Swiss gold exports in June fell to their lowest level since April 2022, primarily due to reduced shipments to major markets like China and India.
Chainwala further commented, “…gold prices are trading lower and may hold declines on Friday due to the absence of any key economic indicators, though potentially dovish comments from a few Fed officials later on Friday could mitigate further losses.”
Silver’s Global Performance
In the international market, silver was quoted lower at USD 29.32 per ounce in New York. Saumil Gandhi, Senior Analyst of Commodities at HDFC Securities, noted that gold edged lower as the US dollar continued its recovery for the second consecutive day. The dollar index rose after rebounding decisively from a four-month low, bolstered by strong US economic data.
