On Monday, following the international market trend, Gold prices in India fell to a four-month low. Silver also saw the fall. On Monday, the precious metal futures fell 2.03% to Rs 63,681.
On the MCX last Friday, gold was trading at Rs 47,500 per 10 grams, down Rs 79 or 0.17 per cent, while silver futures maturing on September 3 were trading at Rs 66,819 per kilogram.
According to Reuters, gold fell as much as 4.4 per cent on the international market on Monday, hitting a more than four-month low as strong U.S. jobs data fueled fears that the Federal Reserve would raise rates sooner than expected, raising the opportunity cost of holding non-interest bearing bullion.
Gold lost 2.3 per cent to $1,722.06 per ounce on the spot market. Prices came down to $1,684.37 earlier in the day, hitting the lowest level since March 31.
Meanwhile, gold futures in the United States fell 2.1 per cent to $1,726.40.
In addition, silver fell as much as 7.5 per cent throughout the session, marking ht below of more than eight months standing at $22.50 per ounce.
“The US nonfarm payrolls (NFP) report exceeded expectations with a 943,000 addition in jobs last month. So, the market is anticipating that the Fed’s taper date could be brought forward with an announcement as early as the September meeting and the actual tapering could begin as early as January 2022. The dollar and benchmark 10-year Treasury yields jumped after the data, denting non-yielding gold’s appeal,” said Sriram Iyer, senior research analyst at Reliance Securities in a statement to News 18.
Iyer further added, “International spot and futures gold & silver prices have started this Monday morning in Asian trade with big cuts extending weakness from last week as better expected U.S. jobs data, could bring forth the timing of the Federal Reserve policy tightening. Technically, LBMA Gold has corrected more than 1.5% where it has breached the support of $1750 levels indicating a downside pressure to continue up to $1722-$1710 levels. Resistance is at $1746-1758 levels. Technically, if LBMA Silver trades below $24.00 levels we could witness the continuation of its Bearish momentum up to $23.53-$22.55 levels. Resistance is at $24.15-$25.19 levels.”
Gold and silver rates in India are heavily influenced by worldwide values and are determined using them as a base. Other variables that influence the pricing of precious metals include the USD to INR conversion rate and the supply and demand of gold and silver in MCX trading.