Mumbai: Gold prices took a hit on Monday due to a stronger US dollar and weaker trends in global markets. Investors are holding their breath for major central bank meetings later this week, hoping to catch hints about future financial policies. In Mumbai, 24-carat gold was priced at 1,24,480 rupees per 10 grams, while 22-carat gold stood at 1,15,140 rupees per 10 grams, excluding GST and making charges. On the Multi Commodity Exchange (MCX), gold opened 0.77 percent lower at 1,22,500 rupees per 10 grams.
After a two-month surge where gold hit record highs, this drop has sparked questions: Is gold just taking a breather, or is it entering a new phase? Globally, spot gold fell 0.7 percent to 4,082.77 dollars per ounce, and US gold futures dropped 1 percent to 4,095.80 dollars per ounce. In India, per-gram prices for 24-carat, 22-carat, and 18-carat gold were 12,448 rupees, 11,410 rupees, and 9,336 rupees, respectively.
The US dollar reaching a two-week high against the Japanese yen made gold less appealing for buyers using other currencies. Optimism about possible progress in US-China trade talks also boosted riskier investments like stocks, pulling focus away from precious metals. Kyle Rodda, an analyst at Capital.com, noted, “The potential trade deal between the US and China caught markets by surprise in a good way.” He added that while gold’s shine has dulled for now, expectations of loose financial policies should keep its overall upward trend alive.
This dip follows a period of heavy buying driven by global uncertainties. Some experts see it as a natural pause after big gains, not a major shift, especially with signs of cooling inflation and improved market confidence. Much depends on the US Federal Reserve’s meeting on October 29, where a 25-basis-point interest rate cut is widely expected. Investors are watching Federal Reserve Chair Jerome Powell’s comments for clues on future rate moves. A hint of a pause could pressure gold further, but a softer stance might spark renewed interest.
Market opinions vary. Some experts view the drop as a healthy step before another potential rise, given ongoing global risks and expected policy easing. Others caution that if the Fed signals strong economic confidence and the dollar keeps climbing, gold prices might stay in a tight range. Darshan Desai, CEO of Aspect Bullion and Refinery, said short-term gold trends hinge on big economic headlines. “With trade deal hopes and a strong dollar, demand for safe investments like gold has eased. This week’s central bank meetings and global earnings could trigger more profit-taking,” he explained.
Rahul Kalantri, Vice President of Commodities at Mehta Equities, added that gold is testing key levels. “After a massive rally, the strong dollar and positive trade news have led to heavy selling. Support for gold is around 4,050-4,005 dollars per ounce, with resistance at 4,145-4,165 dollars. In India, prices may find support between 1.21 lakh and 1.22 lakh rupees per 10 grams,” he said.
