Gold and silver prices in India opened lower on the Multi Commodity Exchange (MCX) on Friday, following weakness in the global bullion prices, and ahead of the announcement of the Reserve Bank of India’s monetary policy later today.
MCX gold rate for August futures contracts opened lower by ₹949, or 0.59%, at ₹1,58,598 per 10 grams as against its previous close of ₹1,59,547 level. MCX silver price for July futures contracts opened lower by ₹4,772, or 1.8%, at ₹2,60,024 per kg as compared to its previous close of 2,64,796 level.
At 9:05 AM, was trading at ₹1,58,330 per 10 grams, down by ₹1,217, or 0.76%. traded lower by ₹3,597, or 1.36%, at ₹2,61,199 per kg.
In the international market, gold prices traded lower as concerns over escalating US-Iran war in the Middle East dampened hopes for a peace deal amid rising inflation and interest rate-hike fears.
Spot price declined 0.5% to $4,452.20 per ounce. It has fallen about 1.8% for the week so far. US gold futures for August delivery fell 0.6% to $4,478.50. Spot dropped 1.4% to $72.89 per ounce,
The Iran-backed Hezbollah militia rejected a new said it would not withdraw troops from the country, undermining US President Donald Trump’s efforts to halt fighting there to forge peace with Tehran, Reuters reported.
While gold is seen as a hedge against inflation, higher interest rates tend to weigh on the non-yielding metal.
Investors will focus on the and repo rate decision later today. The June RBI MPC meeting comes amid a backdrop of a challenging macroeconomic environment as the adverse impact of the US-Iran war in the Middle East on domestic growth and inflation dynamics.
Meanwhile, markets are pricing in a US Federal Reserve rate hike before year-end, with a 51% chance of a move by December, according to CME Group’s FedWatch tool.
Investors now await the May US nonfarm payrolls data, due later in the day, to gauge the Fed’s monetary policy path.
(More to come)