Gold prices are likely to witness some consolidation in the domestic markets next week as investors brace for a series of key central bank meetings and global trade developments, analysts said.
Investors will keenly follow the US Federal Reserve’s (Fed) policy outcome and remarks from Fed Chair Jerome Powell for cues on the interest rate decision.
The US President Donald Trump and his Chinese counterpart Xi Jinping’s meeting in South Korea, and the European Central Bank’s policy review on Thursday are also expected to steer the trajectory of precious metal prices, they added.
“Gold prices closed in negative for the first time in ten trading weeks, on profit-booking at recent tops, weakening physical demand in Asian centres like India & China, and further weighed by a stronger US dollar,” Pranav Mer, Vice President, EBG — Commodity & Currency Research, JM Financial Services Ltd, said.
He said physical demand in India weakened in the latter part of the week as buyers trimmed purchases in anticipation of a deeper price correction while lower prices sparked buying interest in China and Singapore.
On the Multi Commodity Exchange (MCX), gold futures for December delivery fell by ₹3,557, or 2.80 per cent, during a holiday-shortened week.
“The latest selloff in gold prices follows profit-taking by investors amid a record run in the bullion market.
“Additionally, signs of a thaw in US-China trade relations and a possible positive outcome in trade talks between New Delhi and Washington have also bolstered the risk-off sentiment, pushing gold prices lower,” Prathamesh Mallya, DVP – Research, Non-Agri Commodities and Currencies, Angel One, said.
On the global front, Comex gold futures dropped $75.5, or 1.8 per cent, over the week. The yellow metal hit an all-time high of $4,398 per ounce on Monday but tumbled by $266.4, or 6.11 per cent, on Tuesday, marking its biggest one-day fall in over a decade.
“Gold witnessed its sharpest one-day decline in over a decade this week, retreating more than 6 per cent as investors booked profits following a prolonged record-setting rally. The sell-off was largely technical, with prices failing to hold above the $4,300 an ounce level,” Riya Singh — Research Analyst, Commodities and Currency, Emkay Global Financial Services, said.
She added that renewed optimism about US-China trade discussions and a firmer dollar also capped safe haven flows to gold.
“The sharp reversal is due to months of speculative positioning tied to expectations of deeper rate cuts by the Fed and concerns about fiscal weakness. Despite the steep correction, the broader outlook for gold remains bullish,” Singh said.
She explained that macro drivers, such as persistent US deficits, central bank diversification away from the dollar, and elevated geopolitical risk, continue to support the long-term case for bullion.
Silver, too, succumbed to profit-taking after its recent record-setting rally. On the MCX, white metal futures for December delivery crashed by ₹9,134, or 5.83 per cent.
In the international markets, silver futures shed 3.02 per cent in the past week. It had hit a record of $53.76 per ounce on October 17. The white metal suffered losses by over 8 per cent, marking its steepest one-day fall since 2021, to touch $47.12 per ounce on October 21.
“Silver mirrored gold’s weakness but suffered sharper correction of nearly 9 per cent as profit-taking intensified after its meteoric rise earlier this month. The decline was exacerbated by a temporary easing in supply concerns and stronger US bond yields,” Singh noted.
Despite the pullback, she said, “Silver’s fundamental outlook remains robust, supported by rising industrial demand from the solar photovoltaic and electric vehicle sectors.”
Traders said the physical demand for bullion reflected a subdued tone.
Retail demand weakened as consumers anticipated lower prices, though jewellers expect that any dip could revive festival-buying interest as the wedding season gathers pace.
Pranav Mer of JM Financial Services said silver prices may see further correction in the domestic markets, but may rebound towards ₹1,51,000-1,59,900 per kg level once the metal stabilises.
Meanwhile, Riya Singh expects silver to advance towards $60 an ounce in the next 8-12 months, if investment flows and industrial demand remain resilient.
Analysts said investors await a heavy calendar of global policy decisions.
They added that bullion markets are likely to stay volatile but largely range-bound with a bias towards consolidation before the next decision move.