Gold and silver decline up to 2 per cent as crude prices surge above USD 110

Gold and silver retreat despite strong yearly gains. Representational Image

Gold prices saw notable selling pressure on the Multi Commodity Exchange (MCX). The June 5 gold futures contract fell to an intra day low of Rs 1,50,450 per 10 grams, down 0.83 per cent (Rs 1,271). It briefly touched a high of Rs 1,51,802 before slipping again.

As per the latest update, gold was trading at Rs 1,50,600, down Rs 1,121 or 0.74 per cent.

Silver sees sharper decline

Silver prices dropped even more steeply during the session. The May 5 futures contract fell to an intra day low of Rs 2,36,600 per kg, down 2.16 per cent (Rs 5,224). The high for the day was Rs 2,41,250, reported news agency IANS.

At the last count, silver was trading at Rs 2,37,600, down Rs 4,224 or 1.75 per cent.

Expert view

Market experts believe that precious metals may remain under pressure in the near term due to global uncertainty.

One expert noted, "MCX Gold is witnessing selling pressure near resistance levels, with Rs 1,52,000 acting as a key hurdle."

They added that a move above this level could push prices higher, but a fall below Rs 1,51,000 may lead to further selling.

On silver, the expert said, "prices are hovering around Rs 2,40,000, indicating weak buying interest." A rise above Rs 2,42,000-Rs 2,44,000 may support recovery, while falling below Rs 2,40,000 could accelerate losses.

Global market trends

In the international market, prices also declined gold on COMEX fell 0.27 per cent to USD 4,680 per ounce while silver dropped 0.73 per cent to USD 74.48 per ounce.

Despite the recent dip, long-term performance remains strong as gold has gained over 40 per cent in the past year (in dollar terms) and silver surged about 125 per cent, more than doubling investor returns.

Geopolitical tensions add to uncertainty

Ongoing tensions between the United States and Iran continue to impact markets. Peace talks have been unstable, with disagreements over key issues.

Iran proposed reopening the Strait of Hormuz and restarting nuclear talks if US maritime restrictions were lifted.

However, the US is reportedly seeking a broader agreement covering multiple issues, keeping uncertainty high.

Adding to the pressure on precious metals, crude oil prices rose sharply:

-Brent crude touched USD111.31 per barrel (up 3 per cent)
-US WTI crude climbed to USD98.81 (up 2.53 per cent)

Higher oil prices often strengthen inflation concerns, which can create volatility across commodity markets.

Gold and silver prices declined amid a mix of rising oil prices and geopolitical tensions. While long-term returns remain strong, short-term movements are expected to stay volatile.

Investors are advised to stay cautious and watch key price levels closely.

(With IANS Inputs)