Gold and silver may face some selling pressure this holiday-shortened week as traders track peace talks between the US and Iran, crude oil rates and the Federal Reserve's policy decision, analysts said.
Domestic commodity markets would remain closed on Friday on account of Maharashtra Day.
"Focus in the coming week will remain on the progress in peace talks between the US and Iran, and their potential impact on oil, gold, and broader financial markets," Pranav Mer, Vice President, EBG - Commodity & Currency Research, JM Financial Services Ltd, said.
On the macroeconomic front, traders will monitor monetary policy decisions from the US Federal Reserve, Bank of Japan, Bank of England and European Central Bank.
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Besides this, key US data on housing, Personal Consumption Expenditures (PCE) inflation and consumer confidence, along with factory activity numbers from major economies later in the week, will also guide sentiment, he added.
Analysts said the April 29 Federal Open Market Committee (FOMC) meeting will be the last chaired by Jerome Powell, making the policy statement and post-meeting press conference particularly significant for precious metals prices.
On the Multi Commodity Exchange, gold futures dropped Rs 1,910, or 1.23%, to close the week at Rs 1.54 lakh per 10 grams, while silver plunged Rs 12,506, or 4.9%, to settle at Rs 2.44 lakh per kilogram.
According to analysts, gold's downside in the domestic market was limited by a weaker rupee, which declined around 1.4% during the past week.
In the international markets, Comex gold fell $138.7, or 2.8% to close the week at $4,740.9 per ounce, and silver declined $5.4, or 6.6% to $76.41 per ounce.
"Gold prices pared some of the recent gains last week after failing to breach past $5,000 per ounce in the international market and were weighed by multiple factors, including profit-booking after a gain of 10-12% in the previous four weeks," Mer said.
Meanwhile, the US-Iran blockade of the Strait of Hormuz pushed crude oil prices above $100 per barrel.
Mer added that the demand for the US dollar and Treasury bond yields remained firm. Stronger-than-expected US retail sales, weekly jobless claims and consumer sentiment data supported the greenback and weighed on gold and silver.
He further stated that buying and selling activity among global central banks remained mixed, while uncertainty over future interest rate cuts or hikes amid higher commodity-led inflation may keep bullion prices volatile.
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Going ahead, analysts expect gold to find support near lower levels but remain vulnerable to further correction if the dollar stays firm and geopolitical risks ease. Silver may remain more volatile due to its dual role as both a precious and an industrial metal.
Any escalating tensions in West Asia, particularly developments around the Strait of Hormuz or dovish signals from major central banks, could revive buying interest, analysts added.
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