Gold and silver prices remain largely steady as investors focus on the US Federal Reserve's upcoming policy decision. A rate cut would typically boost gold prices, but expectations are that the Fed will keep rates unchanged at the conclusion of its two-day meeting later today.
Gold Prices Hold Steady Despite Crude Oil Rise
Despite a recent increase in global crude oil prices, gold has held steady with minor declines. The market is awaiting the Federal Reserve's commentary on inflation and the likely direction of its rate cut policy. A low interest rate environment generally supports gold prices.
Gold's Retreat from Record Highs
Gold has fallen sharply from its record peak, declining by nearly 26% or around Rs 53,000 per 10 grams from its all-time high of Rs 2,02,984 on the MCX. In recent sessions, the metal has traded within a narrow range due to a lack of fresh catalysts. Although gold has recovered from recent lows, it struggles to hold above near-term resistance levels, indicating persistent selling pressure at higher levels.
According to Jateen Trivedi, Vice President and Research Analyst at LKP Securities, the immediate resistance zone is between Rs 1,52,500 and Rs 1,53,000, with a stronger hurdle at Rs 1,55,500. On the downside, initial support is at Rs 1,50,000, with stronger support at Rs 1,48,500. The technical setup suggests gold is trading within a defined range with a downside bias, supporting a strategy of selling on rallies.
Silver and Other Precious Metals
Spot silver rose marginally by 0.1% to $73.12 per ounce. Platinum also gained 0.1% to $1,942.60, while palladium slipped 0.1% to $1,459.14 per ounce.
Energy Price Concerns Impact Gold
The World Bank has warned that energy prices could jump 24% in 2026, potentially reaching levels not seen since Russia's invasion of Ukraine, assuming severe disruptions from the Middle East conflict persist. Oil prices climbed nearly 3% on Tuesday due to ongoing concerns over supply disruptions from the Strait of Hormuz closure, outweighing the UAE's decision to exit OPEC and OPEC+.
Domestic Gold Market Update
According to Saumil Gandhi, Senior Analyst at HDFC Securities, gold touched a three-week low on Tuesday as surging energy prices reignited inflation worries, strengthening expectations that interest rates could remain elevated. Rising inflation expectations have reinforced a more hawkish monetary policy stance, pushing bond yields higher and reducing the appeal of non-interest-bearing assets like gold. Traders also reduced holdings ahead of the Federal Reserve's decision.
Global Gold Market Steady
Gold prices were largely unchanged on Wednesday as investors adopted a cautious stance ahead of Fed Chair Jerome Powell's comments. In the spot market, gold edged up 0.1% to $4,598.45 an ounce, following a decline to its lowest since April 2. US gold futures for June delivery rose 0.1% to $4,612.10 per ounce.
Market participants are seeking clues on how the Iran conflict might affect the global economy, especially as diplomatic efforts remain stalled. US President Donald Trump expressed dissatisfaction with Tehran's latest proposal, indicating Iran was in a state of collapse and still determining its leadership direction.
Demand from China, the world's largest gold consumer, remained firm. Data from Hong Kong's Census and Statistics Department showed China's net gold imports via Hong Kong rose to 47.866 metric tonnes in March, up from 46.249 tonnes in February.
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