Mumbai, Oct 21: Gold prices remained above ₹1.47 lakh per 10 grams in India on Dussehra, while silver traded close to ₹2.10 lakh per kilogram, as investors assessed global economic signals and the outlook for US interest rates. Trading on the Multi Commodity Exchange (MCX) remained suspended during the morning session due to the festive holiday, with the evening session scheduled to begin at 5 pm.
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In the previous trading session on Monday, gold futures for December delivery declined by ₹618, or 0.42 per cent, to settle at ₹1,47,300 per 10 grams. Silver futures for December delivery closed largely unchanged at ₹2,09,825 per kilogram.
According to bullion.co, 24-karat gold in Mumbai was priced at ₹1,47,340 per 10 grams, while 22-karat gold stood at ₹1,35,062 per 10 grams.
Gold and Silver Deliver Strong Annual Returns
Despite recent volatility, precious metals have recorded substantial gains over the past year. Gold prices in India have risen by more than 25 per cent since Dussehra last year, while silver has outperformed the yellow metal, delivering returns of approximately 45 per cent over the same period.
The gains have kept both metals in focus among investors, although short-term movements continue to reflect changing global economic conditions and expectations about monetary policy.
US Interest Rate Outlook Weighs on Gold
International gold prices faced pressure amid elevated crude oil prices, which have fuelled concerns about inflation and strengthened expectations that the US Federal Reserve could maintain a restrictive monetary policy or consider further rate increases.
Spot gold edged up 0.1 per cent to $4,144.15 per ounce, while spot silver advanced 0.6 per cent to $57.44 per ounce.
Higher US Treasury yields have also weighed on gold, which does not offer interest income. As bond yields rise, interest-bearing assets can become more attractive relative to precious metals, potentially limiting demand for gold.
A recovery in US technology stocks has further reduced some demand for government bonds as safe-haven investments, contributing to higher Treasury yields and adding pressure on bullion.
Investors Track Inflation and Federal Reserve Signals
Market participants are closely watching US inflation trends and signals from Federal Reserve policymakers for clues about the future direction of interest rates.
Expectations of higher borrowing costs can strengthen the US dollar and raise the opportunity cost of holding gold, creating headwinds for the precious metal. Conversely, expectations of monetary easing or increased demand for safe-haven assets can support prices.
Gold has largely remained above $4,100 per ounce during October, recovering some stability after falling more than 6 per cent in September. However, the metal continues to face pressure from a stronger dollar and elevated bond yields.
Geopolitical Developments Add to Market Uncertainty
Geopolitical tensions have also contributed to uncertainty in international markets. Gold has remained sensitive to shifting investor sentiment, with its performance influenced by the competing effects of safe-haven demand, inflation concerns and expectations surrounding US monetary policy.
Despite its recent consolidation, international gold prices remain around 20 per cent below their levels before the US-Iran conflict began in late February, according to the figures cited in the market report.
With domestic futures trading set to resume in the evening session, investors are expected to monitor international bullion prices, currency movements and interest-rate expectations for further direction.
For buyers planning festive purchases, the latest prices underline the importance of checking prevailing local rates, as retail jewellery prices may vary depending on purity, making charges, taxes and the jeweller.