Gold prices in the domestic futures market opened higher on Friday supported by escalating tensions between the United States and Iran. However gains stayed capped as the US dollar continued its upward trajectory and dampened global bullion demand.
On the Multi Commodity Exchange (MCX) gold April futures rose 0.20% to Rs. 1,55,110 per 10 grams. Silver March futures also gained 0.65%, to Rs. 2,42,974 per kg.
The price of 24K gold decreased by Rs. 32 in early trade with ten grams of the precious metal trading at Rs. 1,56,170.
Price of 22K gold also declined by Rs. 30 with ten grams of the yellow metal selling at Rs. 1,43,150.
The price of ten grams of 24K gold stood at Rs 1,56,170 in Mumbai and Kolkata and Rs 1,57,310 in Chennai.
In Delhi the price of ten grams of 24K gold stood at Rs 1,56,320.
The dollar index climbed to the 98 mark, extending gains for the fourth straight session and registering its strongest weekly performance since early October.
The rally in the greenback has received backing from strong US economic performance and the Federal Reserve's aggressive monetary policy signals.
A stronger dollar typically pressures gold prices as it increases the metal's cost for international buyers who use different currencies.
The US Federal Reserve's current expectations for upcoming interest rate cuts have declined. The weekly jobless claims data, which the Labor Department released on Thursday, reached its lowest point in five weeks, indicating that the labor market continues to show stability.
According to CME FedWatch estimates traders currently see about a 50% probability of a rate cut at the Fed’s June meeting.
Minutes from the January FOMC meeting indicated policymakers stay divided on the interest rate path, with some members open to further hikes if inflation persists.
Investors are now closely monitoring advanced Q4 GDP data and PCE price index, the Fed’s preferred inflation gauge for clearer direction on monetary policy.
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In international markets, spot gold slipped 0.1% to $4,995.91 per ounce while US gold futures for April delivery rose 0.3% to $5,013.60.
Spot silver eased marginally to $78.29 per ounce. Platinum and palladium also edged lower, reflecting broader commodity market consolidation.
On the MCX, gold has support at Rs. 1,53,150 and Rs. 1,52,200 and resistance atRs. 1,55,800 and Rs. 1,57,500. Silver has support at Rs. 2,36,600 and Rs. 2,31,000 and resistance at Rs. 2,45,500 and Rs. 2,51,000.
Internationally gold has support at $4,964 and $4,915 while resistance is at $5,055 and $5,122 per troy ounce. Silver has support at $74.40 and $72 while resistance is at $80 and $82.40 per troy ounce.