Gold and silver prices extended their decline on Thursday, November 12, as concerns over stronger-than-expected US inflation weighed on precious metals. On the Multi Commodity Exchange (MCX), December gold futures dropped 0.93% to ₹1.38 lakh per 10 grams, while December silver futures fell 1.32% to ₹1.82 lakh per kg. The decline follows international bullion prices slipping below key levels, with gold dipping below $4,000 per ounce.
The fall in prices comes amid pressure from stronger US inflation data, which has raised expectations of further monetary tightening by the US Federal Reserve. A stronger dollar and rising US Treasury yields typically weigh on gold, as the metal does not offer interest income. Vikram Subburaj, CEO of Giottus.com, noted that gold and silver futures are facing renewed pressure due to these factors.
Silver's price movements are also influenced by industrial demand, making it sensitive to economic growth expectations. Prithviraj Kothari, Managing Director of RiddiSiddhi Bullions, suggested that gold could test $3,900 per ounce if the weakness persists, while silver is awaiting a decisive move out of the $51-$53 per ounce range. However, continued purchases by central banks, particularly the People's Bank of China, are providing some support to gold prices.
Investors are closely watching upcoming US inflation and producer price data, along with commentary from Federal Reserve officials, for further clues on the interest rate outlook. For Indian investors, the rupee's movement will also be crucial, as a weaker rupee can cushion the impact of falling international gold prices on domestic rates.