Gold Prices to be Shaped by US-Iran Talks, Fed Speeches, and RBI Policy
US-Iran Tensions and Fed Comments Set to Influence Gold Prices
The week ahead is expected to be pivotal for gold prices, with analysts citing US-Iran tensions, movement in crude oil prices, key macroeconomic data, and speeches by US Federal Reserve officials as the major drivers. According to analysts, comments from Fed officials could significantly influence interest rate expectations and shape the near-term direction of bullion prices.
Gold Prices Remain Under Selling Pressure
Gold prices have remained under selling pressure in recent weeks, amid a sharp decline in crude oil prices and fading safe-haven demand following reports of progress in the US-Iran peace talks. Despite the decline, gold futures on the Multi Commodity Exchange (MCX) fell by Rs 3,104, or nearly 2 per cent, to close the week at Rs 1.55 lakh per 10 grams. Silver declined by Rs 4,848, or 1.8 per cent, to end at Rs 2.66 lakh per kilogram.
Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data
Global Outlook
In overseas markets, Comex gold futures rose marginally to finish the week at USD 4,593 per ounce, while silver edged lower to USD 75.87 per ounce. Analysts noted that a strong rebound in global equities, liquidation in exchange-traded funds (ETFs), and the absence of fresh bullish triggers have capped gains in precious metals.
| Market | Gold Price (USD/oz) | Silver Price (USD/oz) |
|---|---|---|
| Comex | $4,593 | $75.87 |
| MCX | - | - |
| Market | Gold Price (INR/10g) | Silver Price (INR/kg) |
|---|---|---|
| MCX | ₹1.55 lakh | ₹2.66 lakh |
Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline
Key Drivers Ahead
Analysts pointed out that a busy calendar of economic data releases could significantly influence Fed rate expectations. Pranav Mer, Vice President, EBG - Commodity & Currency Research, JM Financial Services Ltd, noted that focus will remain on the progress of peace talks between the US and Iran, with the ceasefire and negotiation window extended by another 60 days. A positive outcome could further pressure oil and gold prices as safe-haven demand eases.
Reserve Bank of India's Monetary Policy Decision
The Reserve Bank of India's (RBI) monetary policy decision on Friday is also expected to influence gold prices in the domestic market. Analysts expect the Reserve Bank to leave the key policy rate unchanged at 5.25 per cent this week and adopt a cautious stance that factors in the possible headwinds to inflation and growth trajectory amid the West Asia turmoil.
Investor Takeaway
Investors should monitor US-Iran talks, Fed speeches, and RBI policy for potential impact on gold prices.
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