Gold prices on the Multi Commodity Exchange (MCX) have experienced a decline, influenced by the imminent decision of the US Federal Reserve regarding a potential interest rate reduction later this week. June gold futures on the MCX witnessed a decrease of Rs 257, equivalent to 0.36%, settling at Rs 71,345 per 10 grams. In a similar trend, May silver futures also saw a downturn, dropping by Rs 457 or 0.4%, to reach Rs 80,395 per kilogram.
According to ET, gold prices have been rising for the third straight month, driven in part by strong demand from central banks and investors seeking safe-haven investments.
In the US markets, gold remains stable, hovering around $2,330 per ounce, showcasing a nearly 5% surge this month in anticipation of the imminent US Federal Reserve meeting. With the Fed anticipated to adopt a more cautious stance in response to elevated inflation levels, there are expectations that this could impact potential future interest rate adjustments.
Despite the likelihood of the Federal Reserve not implementing interest rate cuts as swiftly as anticipated, gold prices have surged by more than 13% throughout this year. This upward trend is bolstered by significant acquisitions by central banks, robust demand from Asian markets such as China, and persistent geopolitical tensions in areas like Ukraine and the Middle East.