Gold prices in India witnessed a sharp decline of ₹2,500 per 10 grams, settling at ₹1.6 lakh per 10 grams, amid renewed tensions between the United States and Iran. The drop was also influenced by a stronger US dollar and profit-booking by investors.
Factors Behind the Decline
The precious metal faced selling pressure as geopolitical risks escalated following fresh US-Iran confrontations. Analysts noted that the safe-haven appeal of gold was overshadowed by a rally in the US dollar, which made the greenback-denominated metal more expensive for holders of other currencies. Additionally, profit-taking after recent gains contributed to the downward movement.
Silver and Other Precious Metals
Silver also witnessed a fall, declining by ₹1,200 to ₹72,000 per kilogram. Other precious metals like platinum and palladium traded mixed in the global markets.
Global Market Impact
Internationally, spot gold dropped to around $2,350 per ounce, while US gold futures also traded lower. The strengthening dollar index, which measures the greenback against a basket of six major currencies, weighed on bullion prices. Market participants are now closely watching for further developments in US-Iran relations and upcoming economic data.
Outlook for Gold
Experts believe that gold may remain volatile in the near term, influenced by geopolitical events and monetary policy cues from central banks. However, any escalation in tensions could provide support to prices. Investors are advised to monitor global cues and central bank announcements for further direction.
