Gold rate and silver rate fell sharply in Indian markets, tracking decline in global gold rate after US Federal Reserve signalled rate hikes. On MCX, gold futures were down 1.3% to Rs 48,340 while silver fell 1.4% to Rs 63,167 per kg. Gold prices in India fell over 1 per cent on Thursday, after the global rates remained steady near a one-week low.
On Multi Commodity Exchange, Gold February futures were ruling gold rate at Rs 48,254 per 10 gram, down Rs 597 or 1.22 per cent. In the previous session, gold futures ended gold rate at Rs 48,851. Silver March futures were trading at Rs 63,300 per kg, down Rs 771 or 1.20 per cent on MCX.
Globally, gold rate was flat, holding near a one-week low hit in the previous session, after the Federal Reserve decided on March rate hikes that pushed up U.S. Treasury yields and the dollar, while uncertainty over Ukraine capped bullion’s losses, according to Reuters. Spot gold was unchanged at $1,817.29 per ounce, while U.S. gold futures fell 0.7% to $1,817.20.
In global markets, gold extended losses after plunging 1.5% in the previous session – the most in two months. Spot gold today fell 0.2% to $1,815.41 an ounce. The dollar hit multi-week highs against other major currencies after Fed chairman Jerome Powell said there was “quite a bit of room to raise interest rates without threatening the labour market” and said the Fed was of a mind to begin lifting rates in March. U.S. Treasury yields also climbed.
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Higher yields and interest rate hikes dent the appeal of bullion by raising the opportunity cost of holding non-interest paying gold. Among other precious metals, spot silver fell 0.8% to $23.30 an ounce while platinum slipped 1% to $1,021.
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“Silver rate may correct further but chances for a recovery uptick are still open while it stays above $22.60,” the brokerage added. The Russia-Ukraine geopolitical tensions have spurred some safe-haven interest with holdings of the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust rising to a five-month high on Wednesday.
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