Gold and Silver Prices Forecast: A Closer Look at the Outlook for Bullion in May

Gold and Silver Prices in India Decline Sharply Amid Persistent Inflation Concerns

Gold and silver prices in India witnessed a sharp decline on Monday, following losses in international bullion markets. The persistent concerns over elevated inflation and the prospect of higher interest rates continued to weigh on the appeal of non-yielding safe-haven assets.

In the domestic market, the MCX gold rate for June delivery fell by ₹1,115, or 0.74%, to ₹1,50,237 per 10 grams. Similarly, the MCX silver futures for July delivery dropped by ₹3,998, or 1.59%, to ₹2,46,939 per kg.

In global markets, bullion prices also remained under pressure. Spot gold prices slipped 0.5% to $4,588.71 per ounce, while US gold futures for June delivery declined 0.9% to $4,600.60. Spot silver prices eased 0.6% to $74.91 per ounce.

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Investor sentiment remained cautious amid uncertainty surrounding US monetary policy and geopolitical developments. Markets are closely monitoring US plans to escort foreign vessels through the Strait of Hormuz, alongside signs of progress in US–Iran peace talks.

Comments from US Federal Reserve officials have further dampened sentiment. Policymakers who dissented from last week’s policy stance indicated that the oil price shock stemming from the Iran conflict could limit the central bank’s ability to pivot towards rate cuts, raising the possibility of higher borrowing costs.

Rising crude oil prices are seen reinforcing inflationary pressures, which may prompt central banks to maintain a “higher-for-longer” interest rate environment. This, in turn, typically weighs on gold, as it offers no yield.

Notably, gold prices have corrected nearly 12% since the onset of the US–Iran war.

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According to Jigar Trivedi, Senior Research Analyst at IndusInd Securities, persistent inflation and expectations of delayed interest rate cuts may cap the upside in gold prices in the near term. However, ongoing geopolitical tensions and steady physical demand are likely to provide underlying support.

He expects gold prices to remain range-bound with a mild bullish bias, with COMEX gold rate likely to trade between $4,500 and $4,700. On the domestic front, MCX gold rate is projected to move within the ₹1,47,000 – ₹1,53,000 range.

From a technical perspective, Kaveri More, Commodity Analyst at Choice Broking, noted that gold is currently trading with a moderately bearish, range-bound trend.

According to More, key support for MCX silver price is placed between ₹2,30,000 and ₹2,10,000, while resistance is seen at ₹2,67,200 – ₹2,84,400.

Trivedi highlighted that silver is likely to remain more volatile than gold, driven by fluctuations in industrial demand and overall risk sentiment. He expects MCX silver price to find support around ₹2,42,000 per kg, with resistance near ₹2,60,000.

Gold Price Outlook

According to Jigar Trivedi, Senior Research Analyst at IndusInd Securities, persistent inflation and expectations of delayed interest rate cuts may cap the upside in gold prices in the near term. However, ongoing geopolitical tensions and steady physical demand are likely to provide underlying support.

Silver Price Outlook

According to Kaveri More, Commodity Analyst at Choice Broking, key support for MCX silver price is placed between ₹2,30,000 and ₹2,10,000, while resistance is seen at ₹2,67,200 – ₹2,84,400.