Gold Falls Rs 200, Silver Declines Rs 1,000 In Delhi Markets

Gold prices on Monday retreated from record levels to trade at Rs 1,07,670 per 10 grams, down by Rs 200, in the national capital due to fresh selling by stockists, according to the All India Sarafa Association.

The precious metal of 99.5% purity also fell by Rs 200 to Rs 1,06,800 per 10 grams (inclusive of all taxes).

On Saturday, gold of 99.9% and 99.5% purity surged Rs 900 each to hit record highs of Rs 1,07,870 per 10 grams and Rs 1,07,000 per 10 grams, respectively, in the national capital.

Silver also came under selling pressure, tumbling by Rs 1,000 to Rs 1,26,000 per kg (inclusive of all taxes). The white metal scaled a lifetime high of Rs 1,27,000 per kg on Saturday.

Meanwhile, in the futures market, gold and silver rebounded sharply from early losses and hit fresh peaks.

On MCX, the precious metal futures for October delivery climbed Rs 447 or 0.41% to a record high of Rs 1,08,175 per 10 grams. Similarly, December futures also advanced to breach Rs 1.09 lakh per 10-gram level, by jumping Rs 370, or 0.34%.

"Gold remains in the bull's control; the price opened slightly lower in the early trade on Monday. However, it recovered from earlier losses and traded higher, supported by safe-haven demand, rate cut expectations, and a steady US dollar," said Saumil Gandhi, Senior Analyst - Commodities at HDFC Securities.

Silver futures posted an even stronger comeback. The white metal for December delivery soared Rs 1,703 or 1.36% to hit an all-time high of Rs 1,26,400 per kilogram on the Multi-Commodity Exchange on Monday.

On the global front, spot gold rose sharply by $35.11, or 1%, to hit a fresh peak of $3,621.92 per ounce. Also, Comex gold futures for December delivery rose to hit a record high of $3,662 per ounce.

"Gold extended its record-breaking rally, with spot prices breaching to $3,600 per ounce and futures surpassing $3,650 per ounce, underpinned by dovish Federal Reserve expectations and a string of weak US labour market data," said Riya Singh, Research Analyst, Commodities and Currency, Emkay Global Financial Services.

Singh further stated that the precious metal, which opened the week below $3,450 per ounce but swiftly vaulted past the previous $3,500 per ounce high, gained more than 4% in the first week of September and took year-to-date gains above 36%.

"Safe-haven flows were further amplified by escalating geopolitical risks between Russia and Ukraine, heightening concerns of a prolonged conflict," she added.

Spot silver was trading 0.56% higher at 41.23 per ounce. Comex silver futures rose 0.67% to $41.83 per ounce in the global markets.

Renisha Chainani, Head - Research at Augmont, said "Silver is also receiving support as the macro impulse met a tight physical market where industrial demand from solar, electric vehicles, and electronics is rising while supply remains constrained."

Chainani further said that investors will closely monitor US inflation reports (Producer Price Index and Consumer Price Index), which may determine whether the momentum of bullion prices extends toward higher levels or consolidates ahead of the Fed's policy meeting.