Gold extends slide, falls Rs 800 ahead of Rakshabandhan
Gold prices fell for the second straight session, declining by Rs 800 to Rs 1,65,700 per 10 grams in the national capital on Thursday, even as local markets geared up for Rakshabandhan celebrations.
The yellow metal of 99.9 per cent purity had closed at Rs 1,66,500 per 10 grams on Wednesday.
However, silver remained unchanged at Rs 2,50,500 per kilogram (inclusive of all taxes), according to local traders. The decline in gold comes a day before Rakshabandhan, when consumers traditionally step up purchases of gifts and jewellery. The festival, to be celebrated on Friday, is marked by the exchange of gifts between brothers and sisters, with gold and silver jewellery contributing significantly to festive purchases.
Analysts said gold prices also fell due to a rebound in the US dollar and Treasury bond yields.
Spot gold traded lower on Thursday as a recovery in the US dollar and Treasury yields weighed on the yellow metal following stronger-than-expected US inflation data, Saumil Gandhi, Senior Analyst of Commodities at HDFC Securities, said.
Gold declined Rs 1,400 over the last two trading sessions, after touching Rs 1,67,100 per 10 grams on Tuesday.
Akshat Siddhant, Lead Quant Analyst at investment platform Mudrex, said silver remained steady after its initial sell-off in the local markets.
Market participants are also keeping an eye on the US Federal Reserve Chair Kevin Warsh’s Jackson Hole speech on Friday, he said.
Analysts said that any signal on the Fed’s approach to inflation and interest rates could influence the dollar and Treasury yields, which in turn affect the appeal of assets such as gold.
Globally, spot gold slipped marginally to trade at $ 4,585.88 per ounce.
Spot gold prices traded lower as the US dollar index firmed up on inflation data, as Fed rate hike probability increased, Praveen Singh, Head of Commodities at Mirae Asset ShareKhan, said. Silver, however, showed greater resilience in the overseas markets, rising 0.31 per cent to $68.32 per ounce.
