New Delhi, July 24 (PTI) – In a notable shift in the precious metals market, gold prices in India have plummeted by ₹1,400, settling at ₹99,620 per 10 grams. This decline is attributed to profit-booking by stockists and a subdued trend in global markets, as reported by the All India Sarafa Association. The previous day, gold had closed at ₹1,01,020 per 10 grams, marking a significant drop in value.
The Current State of Gold Prices
In the national capital, gold of 99.5% purity also saw a decrease, falling ₹1,200 to ₹99,250 per 10 grams, inclusive of all taxes. This decline follows a previous market session where it had settled at ₹1,00,450 per 10 grams. The sharp drop in prices has raised eyebrows among investors and market analysts alike, prompting discussions about the underlying factors influencing these trends.
Factors Influencing the Decline
Profit-Booking and Global Market Trends
Experts attribute the recent decline in gold prices primarily to profit-booking activities among stockists. As the risk premium eased following the announcement of trade agreements between the United States and countries like Japan and the Philippines, expectations for further deals—particularly with China and Europe—have risen. This optimism has led to reduced demand for gold as a safe-haven asset.
Pranav Mer, Vice President of EBG, Commodity & Currency Research at JM Financial Services, noted, “Gold prices are down on profit-booking, as the risk premium eased.” However, he also mentioned that prices might find some support due to a weaker dollar against major currencies, which often influences gold’s attractiveness.
Silver Prices Take a Hit
In tandem with gold, silver prices have also experienced a significant decline, plunging ₹3,000 to ₹1,15,000 per kilogram. This drop follows a remarkable rally that saw silver prices reach a lifetime high of ₹1,18,000 per kg just a day prior. The volatility in silver prices reflects broader trends in the precious metals market, where investor sentiment can shift rapidly.
International Market Dynamics
On the global front, spot gold fell by USD 24.35, or 0.72%, to USD 3,362.88 per ounce. Saumil Gandhi, Senior Analyst for Commodities at HDFC Securities, explained that gold retreated from a five-week high as optimism surrounding trade deals diminished the demand for safe-haven assets. This sentiment is echoed in the international silver market, where spot silver prices decreased by 0.53% to trade at USD 39.05 per ounce.
Economic Indicators to Watch
Looking ahead, market participants are keenly observing upcoming economic indicators, including the US weekly jobless claims numbers and S&P Global flash PMI data. These metrics will provide insights into the economic health of the United States ahead of the Federal Reserve’s monetary policy decision next week. Maneesh Sharma, AVP of Commodities & Currencies at Anand Rathi Shares and Stock Brokers, emphasized that traders should remain alert to potential volatility stemming from the European Central Bank’s interest rate decision later in the day.
Conclusion
The recent decline in gold and silver prices in India highlights the intricate interplay between local market dynamics and global economic trends. As profit-booking and optimism surrounding trade agreements influence investor behavior, the precious metals market remains in a state of flux. With key economic indicators on the horizon, market participants will be closely monitoring developments that could further impact gold and silver prices in the coming weeks.
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