Gold prices fell by more than one percent on the country’s futures market Multi Commodity Exchange on Monday (November 24) morning amid reduced expectations of another cut in interest rates by the US Fed in December and reduced geopolitical tension. On the other hand, the prices of silver also appeared to be decreasing. The strength of the dollar index also put a lot of pressure on this decline. MCX Gold December futures fell by about Rs 1600 per 10 grams to Rs 1,22,605 per 10 grams. While MCX Silver December futures declined by Rs 1,736 to trade at Rs 1,52,415 per kg.
Why are gold prices falling?
- No new positive indicators are visible for gold prices to maintain their gains. Dwindling prospects of interest rate cuts by the US Federal Reserve next week are one of the major reasons for the recent decline in gold prices.
- The latest data from the US employment market has dampened the prospects of the US Federal Reserve cutting interest rates by 25 basis points next month.
- According to Reuters report, the US Labor Department’s report on Thursday showed that the number of non-agricultural workers increased by 1,19,000 in September, which is more than double the expected increase of 50,000.
- Strong US employment growth data pushed the dollar to its highest level in nearly six months on Friday.
- Another major reason for the fall in gold prices is the decrease in geopolitical tension. According to a report in Hindustan Times, good progress is being made on US President Donald Trump’s proposal to stop Ukraine’s war with Russia.
- HT quoted Andriy Yermak, the head of the Ukrainian delegation, as telling reporters that the US and Ukrainian sides have made “very good progress”, and are moving towards a just and lasting peace for the Ukrainian people.
gold and silver prices
On the country’s futures market Multi Commodity Exchange, gold prices are falling by Rs 1,098 to Rs 1,23,093 at 9.50 am. Whereas this morning gold opened at Rs 1,22,743. However, gold had closed at Rs 1,24,191 on Friday. However, the prices of gold have decreased by Rs 4,146 since November 13. On the other hand, a big fall was also seen in the prices of silver. At 9.50 am, silver reduced its decline and fell by Rs 838 to Rs 1,53,313 per kg. However, on Monday, silver had opened at Rs 1,53,913 and on Friday, silver had closed at Rs 1,54,151.
Is it time to buy gold?
Several factors, including the rise in the dollar index, news flow on the Russia-Ukraine front, talks on US tariffs and uncertainty over the Fed’s next policy move, are indicating that gold prices may remain volatile in the near future. Some experts are predicting further decline and are suggesting avoiding sleeping for some time.
SEBI-registered Anuj Gupta said that we expect further decline in gold prices. At the international level, gold prices can reach $3,900, while on MCX gold can again touch the level of Rs 1,18,000. Therefore, this may not be the right time to buy gold.
Some experts are suggesting buying silver instead. Manoj Kumar Jain of Prithvifinmart Commodity Research said in Mint report that gold and silver prices are expected to continue to fluctuate this week, ahead of the dollar index global financial markets and the meeting on the Russia-Ukrainian peace deal. We recommend buying silver around Rs 1,53,000 and Rs 1,51,500. During this period, the stop loss of silver can go up between Rs 1,50,000 and Rs 1,55,500 to Rs 1,57,000.