Gold prices drop in Delhi amid weak demand and dollar strength

Gold prices in Delhi dropped by Rs 200 to Rs 1,49,600 per 10 grams on Tuesday, driven by weak retail buying and a strong US dollar. Despite slight gains in international gold prices, domestic demand remained subdued, particularly due to the Pitru Paksha period, when consumers traditionally avoid purchasing gold and other luxury items.

Silver prices, however, held steady at Rs 2.27 lakh per kilogram for the second consecutive session. Traders attributed the decline in gold prices to low consumer and jeweler demand, which is expected to temporarily affect physical demand.

Overseas, spot gold prices edged higher to USD 4,149.44 an ounce, while silver remained flat at USD 61.01 an ounce. Analysts noted that the US dollar's strength could continue to weigh on gold prices, as a stronger dollar makes gold more expensive for international buyers.

Looking ahead, experts suggest that gold prices will likely remain range-bound with a slight bearish bias, influenced by movements in crude oil and the US dollar. For domestic buyers, international gold prices, the rupee-dollar exchange rate, and a revival in physical demand will be key factors in determining future price movements.