Gold and silver prices are trading with a cautious bias on Tuesday, October 13, as investors track the US dollar, interest-rate expectations and crude oil prices ahead of key US inflation data.
On the Multi Commodity Exchange (MCX), December gold futures were quoted at ₹1.49 lakh per 10 grams, down 0.01%, according to the latest price provided.
Silver futures for December delivery traded at ₹2.22 lakh per kg, down 0.05%, according to the latest prices available.
Internationally, gold and silver have seen volatile trading as markets reassess the outlook for US interest rates. While easing expectations of an immediate rate hike could support bullion, elevated bond yields and a firm dollar remain potential headwinds.
Gaurav Garg, Head of Research at Lemonn, said gold and silver were gaining in international markets, although a firm US dollar and uncertainty over the US Federal Reserve’s interest-rate outlook could limit further gains.
He said investors were awaiting US consumer price index (CPI) and producer price index (PPI) data for fresh cues on inflation and the Fed’s next policy moves.
Why are gold and silver prices volatile?
Gold and silver do not generate interest income. When bond yields rise or markets expect interest rates to remain elevated, investors may find interest-bearing assets more attractive, putting pressure on bullion prices. A weaker dollar and lower interest-rate expectations, by contrast, can support precious metals.
N S Ramaswamy, Head of Commodity at Ventura, said gold remained volatile, with markets reducing expectations of an October US Federal Reserve rate hike following weaker payroll data. He noted that expectations of higher rates later in the year and in the first half of 2027 could continue to influence prices.
Geopolitical tensions are also affecting bullion through their impact on energy prices. Ramaswamy said elevated crude oil prices could reinforce inflation concerns and expectations of higher interest rates, creating a challenging near-term environment for gold.
Rajeev Sharan, Head of Research at Brickwork Ratings, said gold had been responding more to movements in crude oil and US interest rates than to geopolitical developments alone. He added that a further price decline could attract buying ahead of the festive season.
What should investors watch next?
US inflation data is a key near-term trigger for bullion prices. Stronger-than-expected inflation could strengthen expectations of higher interest rates, while softer readings could support prices by easing concerns over monetary tightening.
Vikram Subburaj, CEO of Giottus.com, said the near-term outlook for gold and silver remained cautious. He identified the US dollar, bond yields and inflation data as important factors to monitor, while noting that currency movements also influence domestic bullion prices because India imports much of its gold and silver.
For Indian buyers, a weaker rupee can make imported bullion more expensive even when international prices are stable or declining. Domestic prices are also influenced by import duties and local demand.
Does the festive season offer support to gold?
Jewellery purchases ahead of Dhanteras and Diwali could provide support to domestic gold demand, although retail buying does not necessarily translate into an immediate rise in prices.
Ramaswamy expects gold to trade in a range of ₹1.50 lakh-₹1.65 lakh per 10 grams ahead of Diwali, with possible consolidation after the peak festive demand period. This is an attributed market outlook, not a guaranteed price range.
Daniel Munday, Principal Analyst at VT Markets, said weekly inflows into gold exchange-traded funds (ETFs) indicate that some investors are using price declines to build positions and hedge uncertainty. However, he cautioned that a stronger inflation reading and renewed expectations of rate hikes could slow the recovery.
For investors, the key distinction is between a short-term rebound and a sustained change in direction. The dollar, US Treasury yields, inflation data, crude oil and investment flows will help determine whether gold and silver can recover or remain under pressure.
NOTE TO READERS
Disclaimer: This article is for informational purposes only and should not be construed as investment advice. Readers should consult certified experts before making any investment decisions.