Precious metals, gold and silver, may remain under pressure in a holiday-shortened trading week, analysts said, as markets react to developments surrounding US-Iran peace talks, crude oil price movements and key policy decisions of the global central bank.
According to analysts, sentiment in precious metals is expected to be largely shaped by geopolitical and macroeconomic catalysts in the coming days. “The focus next week will remain on progress in US-Iran peace talks, and its potential impact on oil, gold and broader financial markets,” Pranav Mir, EBG Vice President – Commodity and Currency Research, JM Financial Services Ltd, told PTI. Investors will also track monetary policy decisions from major central banks, including the US Federal Reserve, the Bank of Japan, the Bank of England and the European Central Bank. The April 29 Federal Open Market Committee (FOMC) meeting, which will be the last chaired by Jerome Powell, is expected to be closely watched for policy signals. Key US macroeconomic data, including housing numbers, PCE inflation, consumer confidence and factory activity readings from major economies later in the week, are also likely to weigh on sentiment.
On the Multi Commodity Exchange, gold futures fell by 1,910 rupees, or 1.23%, to close the week at 1.54 thousand rupees per 10 gram, while silver fell by 12,506 rupees, or 4.9%, to settle at 2.44 thousand rupees per kilogram. Analysts said the downside for gold in the domestic market was partly mitigated by a weak rupee, which fell about 1.4% during the week. In global markets, Comex gold fell $138.7, or 2.8%, to close at $4,740.9 an ounce, while silver fell $5.4, or 6.6%, to $76.41 an ounce. “Gold prices pared some of the recent gains last week after failing to cross the $5,000 per ounce level in the international market and were affected by multiple factors, including profit taking after 10-12% gains in the past four weeks,” Mir said. Crude oil prices rose above $100 per barrel after the US-Iranian blockade of the Strait of Hormuz raised concerns about supplies. Mir added that strong demand for the US dollar and rising Treasury yields continued to weigh on precious metals, supported by stronger-than-expected US retail sales, unemployment claims and consumer confidence data. He also noted that mixed central bank activity and uncertainty about the timing of future interest rate changes amid commodity-driven inflation could keep bullion volatile. Going forward, analysts expect gold to find support at lower levels but remain weak if the dollar remains strong and geopolitical tensions ease. Silver may experience higher volatility due to its dual nature as an industrial and precious metal.Domestic commodity markets will remain closed on Friday on the occasion of Maharashtra Day. They added that any escalation in the Middle East, especially around the Strait of Hormuz, or cautious signals from major central banks may revive demand for bullion.(Disclaimer: Recommendations, opinions regarding stock market, other asset classes or personal finance management tips given by experts are their own. These opinions do not represent the views of The Times Of India)
