Gold and silver prices today: Yellow metal edges higher in early trade, silver trades lower

Gold prices on the Multi Commodity Exchange (MCX) opened on Monday at a lower price of Rs 58,429 per 10 grams and hit an intraday low of Rs 58,416. In the international market, prices hovered around $1,925.92 per troy ounce. Meanwhile, silver opened on Monday at Rs 68,599 per kg and hit an intraday low of Rs 68,302 on the MCX. The price hovered around $22.75 per troy ounce in the international market.

Anuj Gupta, Vice President of IIFL Securities, said, “Expectation of increase interest rates once or twice by FOMC are putting pressure on gold and silver. The target of 2% interest rates is yet to be achieved. Fear of a slowdown in China as it cuts interest rates is playing negative for industrial metals.”

The prices of all industrial metals corrected last week. The dollar index is at five-week low levels, which may curb the sharp correction in gold and silver prices. US business activity fell to a three-month low in June as services growth eased for the first time this year and the contraction in the manufacturing sector deepened.

“The overall picture, though, indicated that US economic growth ticked up a notch in the second quarter even as worries persist that the Federal Reserve’s aggressive interest rate increases over the past year will trigger a recession. [This is] negative for the dollar. Expectations of physical demand on the lower levels may be seen, which may support bullion prices. Central bank demand may also work as a supportive factor for gold. Traders can buy on the support levels,” said Gupta.

However, gold prices edged higher in early morning trade, recovering from the losses it posted last week. This up move was supported by a steady US dollar and uncertainty in Russia, which went on over the weekend, although the Federal Reserve’s chances of more interest rate hikes this year to calm the Inflationary concerns weighed on bullion’s appeal.

Manav Modi, Analyst, Commodity and Currencies, MOFSL, said, “Governor [Jerome] Powell in his congressional testimony last week signalled more rate hikes ahead, but vowed that the central bank would proceed with caution; while San Francisco Fed Bank President Daly said two more rate hikes this year is a ‘very reasonable’ projection. Over the weekend, we received news from Russia that a powerful mercenary (Wagner Group) chief sent his forces on the move against the Russian military establishment, raising tensions in the country to a level not seen in decades. However, in just a day, these concerns eased out as the group retrieved its forces. US business activity fell to a three-month low in June as services growth eased for the first time this year. This week again is important as along with updates regarding Russia’s uncertainty, important data points like US GDP, and PCE price index will be important to watch for.”