Gold and Silver Prices Continue to Decline Amid Ongoing Conflict and Rising Energy Prices

Key Figures:

• $4,844 per ounce: Spot gold rate today
• $75.6 per ounce: Spot silver prices today
• 0.7%: February Producer Price Index (PPI) increase
• 0.3%: January Producer Price Index (PPI) increase

Market Analysis

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The gold and silver prices continued to decline on Thursday, March 19, following a 4% fall in the previous session. The spot gold rate today decreased by 1% to $4,844 per ounce, while the spot silver prices plunged 2.45% to $75.6 per ounce during the Asian trading hours.

The Federal Reserve's decision to keep interest rates unchanged at its latest meeting on Wednesday, while indicating the possibility of one rate cut this year, has not provided sufficient support to gold prices. The ongoing conflict in the Middle East and rising energy prices are adding to inflationary pressures, reducing the likelihood of rate cuts by the Fed and other central banks.

Economic Indicators

The headline Producer Price Index (PPI) increased by 0.7% in February, exceeding expectations of a 0.3% rise. The surge in energy costs is adding to inflationary pressures, posing a challenge for gold prices, which tend to underperform in a higher interest rate environment.

Read also: Gold and Silver Prices in India: A Review of Current Rates Across Major Cities

Brokerage Firm Outlook

Yes Bank's latest report suggests that the technical analysis of gold is pointing towards a bearish bias. The firm believes that a close below $5,000 per ounce on a daily basis could confirm a breakout for a move to $4,600 or $4,400 per ounce.

Investment Advice

Enrich Money's CEO, Ponmudi R, believes that gold has entered a short-term corrective phase, but the broader bullish structure remains intact. He suggests that COMEX gold is currently trading in the $4,950–$5,020 support band, with strong buying interest visible in the $4,950–$5,000 support zone.

Silver Prices Outlook

Ponmudi also suggests that COMEX silver is trading near the $76–$80 support band, with strong buying interest visible in the $74–$78 support zone. A sustained move above $82 could reignite momentum towards the $85–$88 range and potentially retest previous highs.