COMEX gold was trading at $4,152 per ounce, down $15.50 or 0.37%, after touching an intraday high of $4,179.50 an ounce. COMEX silver fell 0.89% to $61.775 per ounce, after hitting a session high of $62.59 an ounce.
The decline follows a sharp rally in bullion prices last week.
Gold gained around 2%, while silver advanced nearly 5%, supported by a weaker US dollar after softer-than-expected US jobs data raised expectations that the US Federal Reserve could take a less aggressive approach to interest rates.
According to Prithviraj Kothari, Managing Director of RiddiSiddhi Bullions, and President of the India Bullion and Jewellers Association (IBJA), bullion drew support from geopolitical tensions around the Strait of Hormuz, while continued central bank purchases provided an additional cushion despite weaker inflows into gold exchange-traded funds.
Kothari said gold’s rebound from recent lows has been swift, making a short-term pullback possible before the broader uptrend resumes. He added that silver could also witness some consolidation after its recent rally before attempting another move higher.
Market participants are now awaiting fresh economic data and signals from the US Federal Reserve for clues on the interest rate path. Lower interest rates generally support non-yielding assets such as gold by reducing the opportunity cost of holding them.
Meanwhile, investors are also monitoring developments in global commodity markets.
Oil prices edged higher on Tuesday (July 7), although gains remained limited as traders weighed increased supply from OPEC+ producers against the outlook for global demand. A firmer crude oil market can influence inflation expectations, which in turn may affect demand for safe-haven assets such as gold.
Separately, demand for gold-backed financing has remained strong in India. According to a recent CRISIL Ratings report, gold loans emerged as the largest securitised asset class in the April-June quarter, accounting for around 31% of the country’s securitisation volume, overtaking vehicle loans.
The report attributed the trend to strong growth in gold loan portfolios, with NBFCs increasingly using securitisation to raise funds amid sustained credit demand.
-With Reuters inputs
