The movement comes against a mixed global backdrop, with a stronger dollar, expectations around US interest rates and elevated crude oil prices influencing bullion prices.
According to Vedika Narvekar, Research Analyst – Commodities & Currencies at Anand Rathi Share and Stock Brokers, gold was trading around $4,125 an ounce after touching a nine-week low. She said renewed geopolitical tensions and continued ETF demand were supporting prices, but the Federal Reserve remained the key driver.
The latest FOMC minutes showed policymakers remain concerned about inflation, while markets continue to price in a relatively low probability of a rate hike in October but a much higher probability of another hike in December. A stronger dollar tends to weigh on gold as it makes the metal more expensive for buyers using other currencies.
Narvekar expects gold to retain a downward bias in the near term, citing higher oil prices, a strong dollar and Fed rate-hike expectations.
However, she said the longer-term structural demand for gold remains intact and could provide support around $4,000 an ounce in spot gold and ₹1.44 lakh per 10 grams on the MCX.
Vikram Subburaj, CEO of Giottus.com, said MCX December gold had slipped below the important ₹1.50 lakh per 10 grams level, with ₹1.48 lakh per 10 grams emerging as a key support zone. According to him, a move back above ₹1.50 lakh per 10 grams would improve the near-term outlook.
Silver has faced sharper selling pressure.Subburaj identified the ₹2.22–2.23 lakh per kg area as an important support zone for the December contract, while a sustained move above ₹2.26–2.28 lakh per kg could signal renewed buying interest.
At the international level, Gaurav Garg, Head of Research at Lemonn, put spot gold at around $4,129 an ounce, while silver was near $59.91 an ounce. He also pointed to crude oil at around $91.82 a barrel and the rupee at ₹96.77 against the US dollar, highlighting the broader macro backdrop for commodities.
Meanwhile, Prithviraj Kothari, Managing Director at RiddiSiddhi Bullions and President of the India Bullion and Jewellers Association, said gold and silver had broken below key international support levels, with the dollar’s strength and expectations of further US rate hikes weighing on bullion. He sees $4,000 an ounce as the next important level for gold and $57 an ounce for silver.
For Indian investors, currency movements remain an additional factor because a weaker rupee can cushion the impact of declines in international gold prices. Vikram Kasat, Chief Business Officer – Advisory and Dealing at PL Capital, also noted that gold and silver remained supported as investors looked for diversification amid pressure on equities, although he expects market volatility to persist.