Gold Rate Falls: Gold prices in Delhi moved lower again on Wednesday, September 9. The price of gold fell by Rs 100 per 10 grams as local buyers stayed cautious. This was the third session in a row when gold prices declined. According to the All India Sarafa Association, 99.9% pure gold was available at Rs 1,58,000 per 10 grams. On Tuesday, the metal had closed at Rs 1,58,100 per 10 grams.
The fall in the domestic market came even as gold prices in the international market recovered. Investors are now waiting for important inflation numbers from the US. These numbers could give fresh clues about what the Federal Reserve may do with interest rates.
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Gold Prices Stay in A Narrow Range
Gold has been moving in a small price range as traders aren’t taking big positions before the US inflation data. Saumil Gandhi, Senior Analyst – Commodities at HDFC Securities, said the market is being careful ahead of the important numbers due later this week.
“Gold has remained within a narrow range as investors take a cautious approach ahead of important US inflation data set to be released later this week,” Saumil Gandhi said.
Oil prices are also adding pressure to the gold market. Rising crude prices have increased worries that inflation could stay high. The fresh tensions in West Asia have made the situation even more uncertain.
“Higher energy costs could add to inflationary pressures and reinforce expectations that interest rates may remain elevated, limiting the upside in bullion,” Gandhi said.
Higher interest rates can make gold less attractive because the metal doesn’t give regular interest income. Traders are therefore watching inflation closely before making their next move.
Silver Moves Higher By Rs 2,300
Silver went in the opposite direction on Wednesday. The precious metal gained for the second day in a row. Silver prices jumped Rs 2,300 to Rs 2,43,400 per kg, including all taxes. The metal had closed at Rs 2,41,100 per kg on Tuesday.
The stronger silver move came even as gold remained under pressure in the domestic market. Silver has also been seeing strong movement in global markets as investors watch economic data and geopolitical developments.
Global Gold Prices Recover
In the international market, spot gold rose by USD 43.67, or 1%, to USD 4,399.22 per ounce. Silver also gained nearly 1% and reached USD 66.25 per ounce.
Praveen Singh, Head of Commodities at Mirae Asset Sharekhan, said gold recovered after its recent losses as traders waited for developments around the US Treasury’s long-term debt buyback programme.
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The market is also waiting for US Producer Price Index and Consumer Price Index data due later this week. These figures are important because they can affect expectations around the Federal Reserve’s interest-rate decisions.
Manav Modi, Commodities Analyst at Motilal Oswal Financial Services Ltd, said, “Market attention now shifts firmly to US PPI and CPI data later this week, which will be crucial in determining whether inflationary pressures justify a September Fed hike”. Recent market trading has also been affected by higher oil prices and ongoing tensions in West Asia. Brent crude moved above the USD 100 mark on Wednesday, adding to inflation concerns.
