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Gold remains under pressure with prices going down, silver rates drop too

By Saima Siddiqui 
Updated Date
Gold remains under pressure with prices going down, silver rates drop too

New Delhi: Gold and silver, both the precious metals remained under pressure as their prices struggled in Indian markets on Wednesday as well after recording a sharp rise in the previous session.

Also Read :- Gold prices fall today, a day after soaring 2-month high; Silver rates go up

In global markets, gold prices rose higher today after US President Joe Biden unveiled his “once-in-a-generation” investment infra plan of more than $2 trillion in transportation, telecoms and energy infrastructure. This comes just months after the passage of a $1.9 trillion stimulus bill. Some analysts fear that stimulus measures will stoke inflationary pressure in the economy and gold is often considered as a hedge against it.

On MCX, June gold futures were flat ₹44,977 per 10 gram while silver rates were down 0.35% at ₹63,595 per kg. In the previous session, gold had risen 1% while silver 0.9%. In the first three months of this year, gold is down about ₹5,000 per 10 gram in Indian markets and as compared to all-time high of ₹56,200, hit in August last year, the precious metal has corrected ₹11,000 from those levels.

MCX gold faces resistance at ₹45,140 while support at ₹42,820, a domestic brokerage said.

Spot gold was up 0.2% at $1,710.28 per ounce. Among other precious metals, silver dipped 0.1% to $24.36, while platinum was down 0.3% at $1,184.

Also Read :- Gold prices touches 2-month high, rates go up ₹4,000 this month

“Bearish outlook may continue as long as it stays below the support of $1760. However deep liquidation pressure is likely if it breaks below $1660. A direct rise above $1760 is a reversal of the current weak momentum,” the brokerage said in a note.

Meanwhile, equities in Asian markets were mostly higher today, tracking a strong finish on Wall Street. The dollar index was flat at 93.233 after completing its best quarter in a year. US 10-year Treasury yields were also steady at 1.74%.

The US dollar is also expected to remain strong for at least another month, according to reports, which still expect the currency to weaken in the longer term. A stronger dollar and rising yields put pressure on gold.

“Gold may remain under pressure until US dollar or bond yields correct sharply however price may gain some support from Fed’s dovish stance and rising virus concerns,” Kotak Securities said in a note.

Gold traders will also closely watch US employment report, which is due for Friday.

Also Read :- Gold rates fall for 5th day in a row, stands at one-year lows; silver down too

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