MCX gold futures for the June contract traded 0.41% lower at $1.58 lakh per 10 grams in early trade, slipping further from the ₹1.60 lakh per 10 grams mark. Silver futures for the July contract fell 0.79% to ₹2.67 per kilogram.
Internationally, spot gold fell 0.71% to $4,479.10 per ounce, while spot silver declined 1.40% to $71.11 per ounce during early COMEX trading. COMEX bullion prices had already dropped sharply in the previous session, with gold and silver pressured by concerns over inflation and the possibility of higher interest rates.
Market sentiment remained cautious amid escalating tensions between the United States and Iran. US President Donald Trump warned that Washington could resume strikes on Iran within days if negotiations failed, after previously saying he had paused planned military action following appeals from Gulf allies.
The prolonged conflict has also disrupted shipping through the Strait of Hormuz, keeping crude oil prices elevated and adding to inflationary concerns. Brent crude remained near $111 per barrel, while US WTI crude traded close to $104 per barrel despite mild declines on Wednesday (May 20).
Higher oil prices and persistent inflation have led traders to further scale back expectations of US Federal Reserve rate cuts this year, while some market participants are now also factoring in the possibility of another rate hike.
Analysts said bullion prices may remain volatile in the near term as investors await fresh signals from the Federal Reserve and further developments in the West Asia.
-With agencies inputs
First Published: May 20, 2026 10:34 AM IST
