Retail prices eased across major cities, offering some relief to consumers after months of record-high prices. Jewellers reported an improvement in enquiries and selective buying, particularly from consumers planning weddings and festive purchases. However, overall demand remained restrained because prices continued to stay well above historical averages despite the week’s decline.
“Precious metals remained under pressure throughout the week, with both gold and silver declining amid renewed strength in the US dollar and profit booking at higher levels,” says Enrich Money CEO R Ponmudi.
Investment demand also remained mixed. While long-term investors continued to view gold as an effective hedge against inflation, currency volatility and geopolitical risks, short-term traders largely remained cautious ahead of key economic data releases from the United States. Exchange-traded funds linked to gold witnessed selective inflows, indicating that institutional investors continued to maintain exposure to the precious metal even as prices corrected.
“MCX Gold continued to trade with a negative bias after failing to sustain above higher levels. Immediate resistance is placed at Rs 1,45,000–Rs 1,45,500, while a sustained move above Rs 1,46,600 could improve momentum and extend the recovery toward Rs 1,48,000. On the downside, Rs 1,43,000–Rs 1,42,500 remains the immediate support zone, followed by the major support at Rs 1,41,000–Rs 1,40,000. Overall, the broader trend remains negative, with a decisive breakout above key resistance levels required to improve the near-term outlook,” Ponmudi added.
Silver followed a similar trajectory during the week, although its losses were relatively limited due to sustained demand from industrial sectors. Expectations of steady manufacturing activity and continued investment in clean energy technologies helped cushion the decline in silver prices, even as precious metals as a whole faced pressure from the stronger dollar.
The Indian bullion market also witnessed healthy physical demand from jewellers replenishing inventories, but higher price levels continued to discourage large-scale retail purchases. Market participants indicated that consumers were increasingly adopting a staggered buying strategy, purchasing smaller quantities whenever prices corrected instead of making bulk purchases.
Most analysts believe gold has entered a consolidation phase after posting substantial gains over the past several months. The metal continues to enjoy strong long-term support from central bank purchases, persistent geopolitical uncertainties and concerns over the global economic outlook. However, near-term price movements are expected to remain heavily influenced by developments in the US economy, Federal Reserve policy signals, movements in the dollar and bond yields.
Going forward, investors will closely monitor upcoming inflation data, employment figures and comments from Federal Reserve officials for clearer indications on the interest-rate trajectory. Any signs of softer inflation or a shift towards monetary easing could revive buying interest in gold, while continued strength in the dollar and elevated bond yields may keep prices under pressure. Despite the week’s decline, the broader outlook for gold remains constructive as investors continue to view the precious metal as an important portfolio hedge in an environment marked by economic uncertainty and geopolitical risks.
Source: Original Article
