On the Multi Commodity Exchange (MCX), gold futures slipped 0.13% to ₹1.49 lakh per 10 grams (24-karat) around midday trade, while silver declined 0.29% to ₹2.32 lakh per kilogram.
The decline followed a brief uptick in early trade, with prices coming under pressure after the dollar index strengthened past the 93-mark.
A firmer dollar typically makes precious metals more expensive for holders of other currencies, dampening demand.
Global cues remained mixed. Gold prices were largely range-bound internationally as investors stayed cautious ahead of developments around US-Iran tensions and key US economic data. Strong US jobs data has reinforced expectations of prolonged higher interest rates, pushing up bond yields and reducing the appeal of non-yielding assets like gold.
At the same time, crude oil prices continued to trade above $110 per barrel amid geopolitical tensions in the West Asia, fuelling inflation concerns. While higher inflation tends to support gold as a hedge, tighter monetary policy expectations have capped gains.
Satish Dondapati, Fund Manager at Kotak Mahindra AMC, said bullion may remain volatile in the near term due to these cross-currents.
“Gold and silver look positive over the medium to long term, but prices may be volatile in the short term. Strong US data and a firm dollar are creating temporary pressure, while ongoing global tensions continue to support safe-haven demand,” he said.
He added that gold could outperform in the medium term as investors seek safety amid uncertainty, while silver may see stronger gains over the longer term, supported by rising demand from sectors such as solar energy, electric vehicles and electronics.
Analysts also point to structural factors underpinning bullion over time, including high global debt levels, policy uncertainty and continued central bank buying. For silver, a combination of industrial demand and constrained supply is expected to support prices over the longer horizon.
In the near term, however, traders are likely to remain cautious, with price direction hinging on geopolitical developments, movements in the dollar and upcoming US inflation data.
