Editor’s Note
Precious metals faced downward pressure Thursday as a strong dollar and positive U.S. jobs data reduced the likelihood of near-term Fed rate cuts, diminishing the appeal of assets like gold and silver.
Gold and silver prices declined on Thursday, driven by a strengthening US dollar and robust US employment data. This dampened expectations for Federal Reserve interest rate cuts, making non-yielding assets less attractive.
After rising on Wednesday, gold and silver prices declined on Thursday. The rates of precious metals dropped due to a strong US dollar and a decline in the international market. Both the yellow and white metals opened in the red on the Multi Commodity Exchange of India (MCX).
On MCX, gold opened at Rs 1,58,000 per 10 grams, while it was priced at Rs 1,58,755 a day before. Silver opened at Rs 2,61,361 per kilogram compared to Rs 2,63,018 on Wednesday. Later, gold declined to the day’s low of Rs 1,57,701, while silver dropped nearly 1 per cent to Rs 2,60,453 per kilogram.
In the international market, spot gold was seen trading at $5,058 per ounce, up 1%, while spot silver was trading at $83.71 per ounce, up 3.71%.
According to a bullion website, 24-carat gold was down by Rs 700 today and was available at Rs 1,58,730 per 10 grams. Silver fell by Rs 2,020 and was available at Rs 2,61,730 per kilogram.
The US employment data changed market sentiment as the job rate improved in January and the unemployment rate declined. The rise in employment in the United States signaled that the American economy remains strong. The positive news regarding jobs weakened expectations of an early interest-rate cut by the Federal Reserve.
The rise in the dollar index led to a strengthening dollar, thus making gold and silver more expensive for investors using other currencies. This is why selling pressure has increased in bullion.
The geopolitical conditions seem to be improving after the meeting of Israeli Prime Minister Benjamin Netanyahu and US President Donald Trump. Following the meeting, it was stated that no final agreement has yet been reached regarding Iran, although discussions will continue. This uncertainty is keeping markets volatile.
Investors are now eagerly awaiting the US inflation data, which is scheduled to be released on Friday, as it will give signals about future monetary policy.
