Gold, silver prices on Sept 20: Gold rates dip to Rs 50,200, silver stagnant at Rs 56,700 over Fed rate hike risks

Gold prices started lower on Tuesday primarily due to the US Federal Reserve rate hike this week as the interest hike might further put pressure on the precious metal. Gold prices in India were down to Rs 50,200 for 24-carat gold (10 grams), while for 22-carat gold (10 grams) it was Rs 45,850. Silver prices were stagnant at Rs 56,700 per kilogram. 

In the international market, spot gold was at $1,676.80 per ounce, as of 0037 GMT. US gold futures rose 0.5 per cent at $1,686.70. On Monday, gold prices dipped and almost touched a 29-month low hit on Friday, as the US dollar and Treasury yields firmed on expectations of a hefty Fed rate hike. 

In the international market, spot silver was at $19.48 per ounce. Platinum dipped 0.1 per cent to $918.29 and palladium was down 1.5 per cent at $2,191.75. 

Domestic prices 

In the national capital Delhi, the gold price for 24 carats (10 grams) is Rs 50,530, while 22 carat (10 grams) is available at Rs 46,000. In Kolkata, 24-carat gold (10 grams) is available for Rs 50,020, while 22 carat (10 grams) is Rs 45,850.  

On the other hand, the price of 24-carat gold (10 grams) in Mumbai is Rs 50,020, while 22-carat gold (10 grams) is Rs 45,850. In Chennai, 24-carat gold (10 grams) is available for Rs 50,530, and 22 carat (10 grams) is available for Rs 46,320. It is to be noted that gold prices vary from city to city and depend on taxes and duties levied by the state government.  

Also read: Gold, silver prices on Sept 16: Gold, silver rates stare at sharp losses over Fed rate hike risks

Investors’ caution stance 

Investors are expected to maintain a cautious stance as the US Fed, at the conclusion of its two-day policy meeting on Wednesday, is expected to raise interest rates by 75 basis points. A few market observers are also expecting that the hike can be around 100 bps looking at the inflation and recession risks in the US. A high interest-rate environment increases the opportunity cost of holding non-yielding bullion. For most of 2022, bullion has slumped as the Fed has maintained its aggressive monetary policy, which undermines non-interest-bearing assets while boosting the US dollar.