Gold prices witnessed a sharp decline in the domestic market on Wednesday, falling Rs 1,850 to Rs 87,150 per 10 grams, tracking weak global cues. Silver also tumbled Rs 1,500 to Rs 1,02,500 per kg, according to the All India Sarafa Association.
Global Market Trends
In the international markets, spot gold dropped 0.54 per cent to USD 4,463.84 per ounce, while silver slipped 1 per cent to USD 74.43 per ounce. The decline was attributed to a stronger US dollar and rising bond yields, which dampened demand for the yellow metal.
Factors Behind the Fall
Analysts said that the precious metals market is under pressure due to expectations of tighter monetary policy by central banks. Additionally, mixed economic data from major economies has led to uncertainty, prompting investors to shift towards riskier assets.
The drop in gold prices also comes amid a broader sell-off in commodities, with crude oil and base metals also trading lower. Market participants are now awaiting key US employment data later this week for further cues on the Federal Reserve's interest rate trajectory.
Domestically, the decline in gold prices may offer some relief to retail investors looking to enter the market. However, jewellers reported subdued demand as consumers adopted a wait-and-watch approach amid the volatility.
Silver, which is often considered a more volatile asset, saw a sharper percentage decline compared to gold. Industrial demand for silver also remained weak, adding to the bearish sentiment.
