Gold and silver prices extended their losses on Wednesday as renewed tensions in the Strait of Hormuz, a stronger US dollar, and rising US bond yields weighed on precious metals ahead of the release of the US Federal Reserve’s June meeting minutes, with gold now trading nearly 29 per cent below its 52-week high and silver down almost 50 per cent from its record level.
Gold price today: down 29% from its 52-week high
On the Multi Commodity Exchange, gold futures for August 5 delivery were trading at Rs 1,44,877 per 10 grams, down Rs 515 or 0.35 per cent. Gold prices are now Rs 59,498, or 29.11 per cent, below their 52-week high of Rs 2,04,375.
In the international market, spot gold rose 0.5 per cent to USD 4,125.59 per ounce as of 0305 GMT, recovering after falling to its lowest level since July 2 earlier in the session. US gold futures for August delivery slipped 0.5 per cent to USD 4,136.30 per ounce.
Silver price today: nearly half off its record high
Silver futures for September 4 delivery on the MCX were at Rs 2,29,400 per kg, down Rs 1,457 or 0.63 per cent. Silver prices are now Rs 2,24,836, or 49.50 per cent, below their 52-week high of Rs 4,54,236.
Spot silver gained 0.8 per cent to USD 60.47 per ounce internationally. Among other precious metals, platinum declined 0.3 per cent to USD 1,635.45 per ounce, while palladium fell 0.6 per cent to USD 1,268.64 per ounce.
What’s driving the fall: US-Iran tensions and a stronger dollar
According to Manoj Kumar Jain of Prithvi Finmart, the renewed conflict in the Strait of Hormuz has added fresh uncertainty to commodity markets. The US carried out retaliatory strikes on Iran after Iranian forces attacked two ships in the strait on Monday, and followed up with another wave of strikes on Tuesday, also revoking a licence that had allowed Iran to sell oil after three tankers were hit by projectiles.
The escalation pushed US oil prices up nearly 3 per cent in early trade and lifted US Treasury yields, while the dollar held near its strongest level of the week against major currencies. Jain said continued tensions could leave the next round of US-Iran peace talks uncertain, and that rising oil prices risk stoking inflation worries and fears of a Fed rate hike, both of which could keep pressure on gold and silver. Central bank buying, he added, could offer some support to metal prices at lower levels.
Gold price prediction: key support and resistance levels
Jain said gold could hold support near USD 3,910 per troy ounce on a weekly closing basis. For the current session, he placed support at USD 4,080 to USD 4,034 per troy ounce, with resistance at USD 4,154 to USD 4,180.
On the MCX, gold has support at Rs 1,44,400 to Rs 1,43,550 and resistance at Rs 1,46,100 to Rs 1,46,850, according to Jain.
Silver price prediction: levels to watch this week
Silver could hold weekly support around USD 54.40 per troy ounce, Jain said. For the session, he placed support at USD 59.80 to USD 58.00 per troy ounce and resistance at USD 62.40 to USD 63.60.
On the MCX, silver has support at Rs 2,27,000 to Rs 2,24,400 and resistance at Rs 2,33,300 to Rs 2,36,000.
Gold and silver price prediction: Fed minutes in focus
“We expect gold and silver prices to remain volatile this week,” Jain said, citing swings in crude oil prices, the dollar index, and geopolitical tensions. He advised investors to avoid taking fresh positions in gold and silver ahead of the FOMC meeting minutes.
Market participants will watch the Fed minutes closely for signals on the US interest rate outlook, while developments in the Strait of Hormuz and crude oil prices are expected to remain the key drivers for gold and silver in the near term.
