The precious metals market experienced a notable decline in early trading on Friday, with both gold and silver prices slipping on the Multi-Commodity Exchange (MCX). This downward trend mirrored weaknesses observed in international markets, primarily driven by a stronger US dollar.
Gold and Silver Prices on MCX
Gold futures on the MCX opened 0.29% lower at ₹1,21,148 per 10 grams, a decrease from Thursday’s closing price of ₹1,21,508. Similarly, silver futures began the session down by 0.47%, trading at ₹1,48,140 per kg. These declines were largely influenced by losses in global spot prices, reflecting a broader trend in the precious metals market.
Despite the initial drop, there was a slight recovery observed later in the morning. By around 11:38 a.m., the gold futures contract expiring on December 5 was trading at ₹1,21,557 per 10 grams, marking a modest increase of 0.04%. Silver futures also showed resilience, trading flat at ₹1,48,747 per kg. Analysts noted that the early decline was primarily due to traders booking profits ahead of significant economic data releases from the US.
International Market Dynamics
In the international arena, spot gold prices fell by 0.5% to $4,004 per ounce, pressured by a firm dollar and diminishing expectations for early rate cuts by the US Federal Reserve. Meanwhile, US gold futures for December delivery remained largely unchanged at $4,016.70 per ounce.
Despite Friday’s drop, gold has shown remarkable resilience over the past month, increasing by nearly 3.9% in October alone. This upward trajectory indicates that gold is still on track to achieve gains for a third consecutive month, highlighting its appeal as a safe-haven asset amid economic uncertainties.
The Impact of the US Dollar
The strength of the US dollar has been a significant factor affecting precious metals prices. The US dollar index was trading close to its three-month high, which generally dampens sentiment in the precious metals market. A stronger dollar makes bullion less attractive to holders of other currencies, thereby exerting downward pressure on prices.
Stock Market Reactions
In parallel with the precious metals market, the stock market opened flat amid mixed global cues. The Sensex started the session at 84,379.79, down 25 points from the previous closing of 84,404.46. The Nifty index opened 14 points lower at 25,863.80. However, both indices quickly turned positive, buoyed by buying activity in automobile and banking sectors.
Market analysts noted that the recent summit between US President Donald Trump and Chinese President Xi Jinping resulted in a one-year truce in the ongoing trade conflict, rather than a comprehensive trade deal. This outcome left some market participants disappointed, despite the relief associated with reduced trade tensions and the potential for future progress.
Conclusion
As the precious metals market navigates through these fluctuations, investors remain vigilant, particularly with key economic data on the horizon. The interplay between the strength of the US dollar, global economic indicators, and geopolitical developments will continue to shape the landscape for gold and silver prices in the coming weeks. While Friday’s dip may raise concerns, the overall trend suggests that precious metals still hold significant value as a hedge against economic uncertainty.



