Gold, often seen as India’s favourite safe-haven investment, looked a little less attractive on Monday. Prices of the yellow metal slipped as Prime Minister Narendra Modi urged people to avoid non-essential gold buying while the country deals with the economic pressure of rising crude oil prices and growing tensions in West Asia.
At around 12 pm on May 11, prices on the Multi Commodity Exchange (MCX) stood at Rs 1,51,972, down by Rs 558 from the previous session. The fall comes at a time when investors are closely watching both global developments and domestic signals.
Prime Minister Modi on Sunday as the country prepares for the economic fallout of the ongoing Iran-US war and a sharp rise in crude oil prices.
Among his suggestions were avoiding unnecessary gold purchases, postponing non-essential foreign travel and bringing back work-from-home practices where possible. He also encouraged greater use of public transport and reduced dependence on imported products.
The appeal appears to be aimed at helping households and the broader economy manage the impact of a prolonged oil shock, which could raise inflation and increase costs across sectors.
Market experts say gold is facing pressure from several global factors, and the PM’s comments may have added to cautious sentiment.
Virat Jagad, Senior Technical Research Analyst at Bonanza, said the near-term outlook for gold remains weak unless broader economic conditions change.
“Near-term pressure on gold could continue, especially if the current macro setup remains unchanged,” Jagad said.
He explained that gold is currently dealing with three major challenges, i.e., a stronger US dollar, rising bond yields and expectations that the US Federal Reserve may delay interest rate cuts.
“Today’s decline is largely linked to expectations that the US Federal Reserve may keep interest rates higher for longer after strong US economic data and persistent inflation concerns,” he said.
Higher interest rates often reduce the appeal of gold because the metal does not generate regular returns like bonds or fixed-income investments.
According to Jagad, markets are now expecting any meaningful US rate cuts to happen much later than earlier anticipated, which could continue to weigh on gold prices.
“Markets are pushing back expectations for Fed cuts into late 2026, which is negative for non-yielding assets like gold,” he said.
He added that further downside cannot be ruled out in the coming weeks, especially if US inflation numbers and bond yields remain high.
Still, Jagad believes sharp corrections may attract long-term buyers again if the broader global uncertainty continues.
“Unless the long-term macro narrative changes completely, deeper declines may eventually attract strategic buying interest again,” he said.
From a chart perspective, Jagad believes the current movement in gold prices looks more like a pause in a larger uptrend rather than a complete reversal.
“From a technical perspective, this looks more like a medium-term consolidation or correction inside a larger secular bullish trend,” he said.
He added that gold is currently moving in a sideways-to-corrective pattern after recovering from recent lows near $4,500.
The market, he said, remains highly sensitive to US bond yields, Federal Reserve signals and geopolitical tensions.
“Gold needs to sustain above the $4,730–4,800 zone for stronger bullish continuation, while below $4,500, selling momentum is likely to increase in the coming weeks,” Jagad explained.
For now, gold investors may need to stay patient as global uncertainty, inflation worries and changing interest rate expectations continue to shape the market.