The April gold contract fell 5.6 per cent in early trade, extending last week’s losses when prices had already dropped by Rs 13,974, or 8.82 per cent, to close near Rs 1.44 lakh per 10 grams
Representational Image
Gold prices witnessed a sharp decline on Monday, with futures plunging Rs 8,089 to Rs 1,36,403 per 10 grams on the Multi Commodity Exchange (MCX), tracking a global selloff driven by rising inflation concerns and a strong US dollar, reported news agency PTI.
Sharp fall continues downward trend
The April gold contract fell 5.6 per cent in early trade, extending last week’s losses when prices had already dropped by Rs 13,974, or 8.82 per cent, to close near Rs 1.44 lakh per 10 grams, reported PTI.
Analysts said the precious metal opened with a significant gap down and is likely to continue its downward trajectory for the fourth consecutive week.
Global cues weigh on gold prices
In international markets, gold futures on Comex also declined for the fifth straight session. The April contract dropped by USD 202.4, or 4.42 per cent, to USD 4,372.5 per ounce, reported PTI.
Over the past week, global gold prices have fallen nearly 10 per cent, reflecting heightened volatility in commodity markets.
Inflation fears and rate hike bets
Market experts said escalating tensions in West Asia have pushed crude oil prices higher, fuelling global inflation concerns, reported PTI.
This has led to expectations that major central banks may either delay rate cuts or even consider rate hikes, which typically reduces the appeal of gold as a non-yielding asset.
Strong dollar adds pressure
A firm US dollar has further weighed on gold prices. The dollar index remains elevated above the 99 mark, making gold more expensive for investors holding other currencies, reported PTI.
At the same time, the Indian rupee has weakened towards the 94 level against the US dollar, adding to domestic price pressures.
Impact on Indian economy
Analysts warned that rising crude prices and a weakening rupee could widen India’s trade deficit and increase import costs, contributing to inflationary pressures, reported PTI.
Outlook remains volatile
Experts said gold may remain under pressure in the near term as global uncertainties persist and macroeconomic factors continue to influence investor sentiment, reported PTI.
While gold is traditionally considered a safe-haven asset, current conditions — including inflation fears and tighter monetary outlook — are limiting its upside and triggering profit booking.
(With inputs from PTI)
Subscribe today by clicking the link and stay updated with the latest news!" Click here!
