Precious Metals Slip Amid Rising Dollar
New Delhi: Gold and silver prices fell in the domestic futures market on Monday, April 6. Both gold and silver were under pressure on the MCX exchange. This was primarily due to a strong US dollar, rising crude oil prices, and strong US employment data, which impacted investor sentiment.
Gold futures for June delivery on MCX fell by nearly ₹1,400, or nearly 1%, to ₹1,48,298 per 10 grams. Meanwhile, silver for May delivery fell by more than ₹2,800, or over 1%, to ₹2,29,651 per kilogram. This decline in prices of both was observed in early trading.
The US Dollar Index remains above 100, making gold more expensive in the international market. Rising crude oil prices are also increasing demand for the dollar, as oil is traded in dollars globally. In such a situation, a strengthening dollar weakens demand for precious metals like gold and silver.
Crude oil prices have reached multi-year highs due to the US-Iran war. Brent crude was trading around $110 per barrel on Monday morning. The war, which began on February 28 and has now entered its sixth week, has created uncertainty in the global market and raised fears of inflation.
Strong US employment data has also increased pressure on gold and silver. Non-farm payrolls increased by 178,000 in March, the highest since December 2024. The unemployment rate has also declined to 4.3%. These data have further weakened the possibility of an interest rate cut by the US Federal Reserve.
Precious metals also saw a decline in the global market. Spot gold fell about 1.2% to $4,620.68 per ounce, while spot silver fell 1% to $72.28 per ounce. Among other metals, platinum rose 0.5%, and palladium recorded a slight gain.
According to experts, rising US bond yields and a strengthening dollar have diminished the attractiveness of non-yielding assets like gold and silver. Global developments, crude oil prices, and Federal Reserve policies will determine the direction of these metals in the future.
