Gold and silver prices continued to slide on Thursday after witnessing one of their sharpest drops in years earlier this week. The correction comes after a prolonged rally that had pushed both metals to record highs, prompting investors to book profits amid broader market weakness.
on Tuesday, while silver recorded its steepest one-day decline since February 2021. The recent weakness reflects growing caution among investors as they await key U.S. economic data that could determine the next move in interest rates.
Gold prices were trading lower in early trade on Thursday. Spot gold slipped 0.3% to $4,082.95 per ounce as of 1:44 a.m. GMT, while U.S. gold futures for December delivery rose 0.8% to $4,097.40 per ounce.
The dollar index edged up 0.1% against major currencies, making gold slightly more expensive for holders of other currencies. A stronger dollar typically limits demand for precious metals, which are priced in the U.S. currency.
All eyes are now on the U.S. Consumer Price Index (CPI) report for September, which is expected on Friday. The data, delayed due to the government shutdown, is likely to show core inflation holding steady at 3.1%.
The inflation numbers will be crucial in shaping market expectations for interest rate cuts. Investors have already priced in a 25-basis-point rate cut at the Federal Reserve’s meeting next week.
Gold usually benefits from lower interest rates, as it reduces the opportunity cost of holding non-yielding assets like bullion. However, in the short term, market volatility and profit booking can drive prices down.
Market sentiment was also influenced by comments from U.S. President Donald Trump, who said he expected to reach a trade agreement with Chinese President Xi Jinping next week in South Korea. He also mentioned that discussions would include China’s oil purchases from Russia.
Meanwhile, Russia confirmed it was preparing for a possible summit between President Vladimir Putin and Trump, a development being closely watched by investors for any potential impact on global trade and energy markets.
Geopolitical uncertainties have played a key role in driving gold prices this year, as investors sought the safety of precious metals amid global tensions and slowing economic growth.
Despite the recent fall, gold remains one of the best-performing assets of 2025. Prices have surged about 56% since January, touching an all-time high of $4,381.21 per ounce on Monday. The rally has been driven by a mix of economic uncertainty, expectations of interest rate cuts, and strong buying by central banks across the world.
However, the recent sell-off suggests that some investors are now locking in profits after the rapid run-up. Holdings in SPDR Gold Trust — the world’s largest gold-backed exchange-traded fund — dropped 0.59% to 1,052.37 metric tons on Wednesday from 1,058.66 tons a day earlier, reflecting some outflow from institutional investors.
The weakness in gold has spilled over to other precious metals. Spot silver fell 0.4% to $48.31 per ounce, extending its decline after reaching record highs earlier this month. Platinum slipped 1.4% to $1,598.65 per ounce, while palladium also dropped 1.4% to $1,438.47 per ounce.
Analysts say silver’s fall has been sharper because of its dual role as both an industrial and investment metal. Slowing global demand and profit-taking after recent highs have weighed on sentiment.
Experts believe the short-term trend for bullion may remain volatile as traders assess U.S. inflation data and central bank policy updates. If inflation cools and the Fed signals a softer stance on rates, gold could find support again.
In India, gold prices are likely to remain sensitive to global cues, the rupee’s movement, and domestic demand during the post-festive period.
While analysts expect the long-term outlook for gold to stay positive due to continued central bank buying and global uncertainty, they advise caution in the near term as prices could fluctuate before stabilising.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)