Precious Metals Suffer Losses in September Amid Dollar Strength
Precious metals faced a challenging September, with both gold and silver recording negative returns. The strengthening of the US Dollar and expectations of a US interest rate hike weighed heavily on sentiment. Rising crude oil prices further exacerbated the downturn. As a result, Comex gold dropped 6.8% to close at $4,189.1 per ounce, while Comex silver fell 9.6% to settle at $60.75 per ounce.
Domestic markets mirrored the global trend, with MCX gold declining 4.1% to ₹1,149,092 per 10 grams and MCX silver falling 6.8% to ₹2,23,740 per kilogram. The weakening Indian Rupee against the US Dollar somewhat softened the impact in the domestic market.
Comex gold breached its support zone of $4,200-$4,220, leading analysts to predict a range-bound price action between $3,900 and $4,550. Similarly, Comex silver dropped below $62.5, suggesting a volatile range of $54 to $69. MCX gold is now expected to oscillate between ₹1,41,000 and ₹1,59,000, while MCX silver may remain within ₹2,15,000 to ₹2,48,000.
The short-term positive outlook for both metals has been invalidated, and prices are likely to stay range-bound until key levels are breached. Analysts advise caution, emphasizing the lack of a definitive trend in the near term.