Gold and silver prices declined sharply as easing geopolitical tensions and a cautious Federal Reserve stance weighed on safe-haven demand. Gold futures for August traded lower by more than 1 percent, slipping to an intraday low near Rs 1,51,768 on the Multi Commodity Exchange (MCX). Silver futures also fell significantly, reaching an intraday low almost 3 percent below the previous close, reflecting the broader downward trend.
The Federal Reserve maintained interest rates but indicated the possibility of further hikes, signaling its ongoing commitment to controlling inflation. This hawkish tone, combined with rising US Treasury yields and a stronger dollar, reduced the appeal of precious metals as alternative investments. Market analysts attributed the price drop to these factors along with a decline in geopolitical tensions following an interim agreement between the US and Iran, which eased safe-haven buying.
Despite the drop, silver’s losses were comparatively limited due to expectations of robust industrial demand. Analysts pointed to increased investment in sectors like artificial intelligence infrastructure, data centers, renewable energy, and energy storage systems, especially in China, sustaining some support for silver prices. In global markets, COMEX silver fell close to 3 percent to trade around $68.76, while gold decreased over 1 percent to about $1,318.90 per ounce.
On the energy front, benchmark crude oil prices also took a hit, with Brent crude down around 1.6 percent near $78 per barrel and US West Texas Intermediate crude dropping 2 percent to roughly $75 per barrel. This decline added to the broader commodity market softness amid the shifting economic landscape.