Gold and silver prices declined in early trading on Tuesday, October 13, as a stronger US dollar and lingering uncertainty over the Federal Reserve’s interest rate policy weighed on precious metals. COMEX gold futures dropped $16.90, or 0.40%, to $4,173.70 an ounce, while COMEX silver futures fell $0.698, or 1.15%, to $59.815 an ounce.
The dollar’s strength limited gains for precious metals, despite softer oil prices in the previous session. Elevated oil prices and geopolitical tensions added to uncertainty over inflation, making investors cautious ahead of US consumer price data. Gaurav Garg, head of research at Lemonn, noted that the US Dollar Index remained near an 18-month high, restricting upside potential for gold and silver.
Analysts highlighted that gold and silver are sensitive to the US dollar and bond yields because they do not generate interest income. A stronger dollar makes these metals more expensive for foreign buyers, while higher yields can make interest-bearing assets more attractive. Charu Chanana, chief investment strategist at Saxo, pointed out that geopolitical developments and rising oil prices could further complicate inflation expectations and interest rate cuts.
Looking ahead, key factors influencing bullion prices include US inflation data, Federal Reserve signals, the dollar, and Treasury yields. Prithviraj Kothari, managing director of RiddiSiddhi Bullions, noted that hawkish Fed commentary, a firm dollar, and elevated US Treasury yields had previously weighed on gold and silver. However, continued gold purchases by China and record global gold ETF holdings provided some support. Indian buyers, meanwhile, remain price-sensitive ahead of the festive season.