Gold may become cheaper in the coming days.
In about 3 weeks, there has been a decline of more than 8 percent in the prices of gold in the futures market of the country. On the other hand, the condition of silver prices is also very bad. The way the prices of gold and silver had risen during the Diwali season. It seemed that by the end of the year both the precious metals would reach a different level. But as the tariff war between China and America calmed down and talks progressed regarding a trade deal between the two, the demand for safe havens like gold and silver decreased. Experts believe that further decline may be seen in the prices of gold and silver. There is a reason for that too.
After China and America, a trade deal can be done between India and America in mid or last week of November. After the trade deal between the two countries, Russia may also have to come to a ceasefire situation with Ukraine due to pressure from India and China. Due to which further decline may be seen in the prices of gold and silver. At the same time, the US Central Bank has already indicated that interest rates can be kept on hold in the December policy meeting. In such a situation, the prices of gold and silver will suffer further shock.
On the other hand, gold prices are expected to continue correcting in the coming week ahead of US inflation data, ongoing uncertainties regarding trade tariffs and China’s key economic data. Analysts predicted that traders will also keep a close eye on the comments of US Federal Reserve officials for clarity on monetary policy. This is likely to decide the direction of bullion prices in the near future. Let us also tell you what the experts have to say in this matter?
Will keep an eye on these
Pranab Mer, Vice President, EBG – Commodity and Currency Research, JM Financial Services Ltd, said a healthy fall or further correction in gold prices is expected as all focus will be on inflation data, US Supreme Court hearing on tariffs, speeches by Fed officials and Chinese data. He said that gold prices decreased slightly this week, but this metal largely remained within a limited range. Its gains were limited due to strong dollar and sluggish physical demand. Retail buyers are away from the market fearing further fall in prices.
Prices may be affected by this
On Multi Commodity Exchange (MCX), the futures price of gold for December delivery closed at Rs 1,21,067 per 10 grams on Friday, down by Rs 165 or 0.14 percent from last week. Angel One’s DVP (Research, Non-Agricultural Commodities and Currency) Prathamesh Mallya said that during this period, the futures price of gold on MCX remained in the range of Rs 1,17,000-1,22,000 per 10 grams. The weak report of the US labor market, demand for safe investments, expectation of interest rate cuts in the US and central bank purchases may affect the price of gold in the near future. He further said that gold is on its highest annual growth path since 1979, and if the current fundamental factors remain in effect, gold prices may rise further soon.
How much has gold fallen?
The special thing is that a big fall has been seen in the prices of gold and silver in the futures market of the country. On October 17, the prices of gold and silver were at their peak. If we look at the MCX data, on October 17, the price of gold had reached a life time high of Rs 1,32,294. Which closed at Rs 1,21,067 on November 7. This means that since then a decline of Rs 11,227 has been seen in the prices of gold. However, on Friday, gold prices closed with a fall of Rs 165 in the futures market.