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Gold prices eased in early Tuesday trade, pressured by a stronger US dollar and waning expectations of another interest rate cut by the US Federal Reserve this year. Profit-booking among investors also contributed to the decline. The MCX Gold December futures were trading 0.42% lower at Rs. 1,20,894 per 10 grams, while MCX Silver December contracts dropped 0.48% to Rs. 1,47,050 per kg.
In Mumbai, gold prices edged slightly higher. The price of 24-carat gold rose to Rs. 12,318 per gram from Rs. 12,317 a day earlier, while 10 grams traded at Rs. 1,23,180 compared to Rs. 1,23,170 the previous day.
Similarly, 22-carat gold rose to Rs. 11,291 per gram from Rs. 11,290, with the 10-gram price gaining to Rs. 1,12,910 from Rs. 1,11,900.
In Chennai, gold prices also increased. The price of 24-carat gold rose to Rs. 12,383 per gram from Rs. 12,382 the previous day, while 10 grams rose to Rs. 1,23,830 from Rs. 1,23,820.
22-carat gold also increased to Rs. 11,351 per gram from Rs. 11,350, and for 10 grams the price rose to Rs. 1,13,510 to Rs. 1,13,500.
The US dollar index climbed 0.20% to 100.05, marking its highest level in more than three months. The currency’s strength has limited gold’s appeal for foreign buyers.
Traders’ optimism for further rate cuts from the Federal Reserve has faded after Chair Jerome Powell’s recent remarks signaled a pause in monetary easing. While the Fed had reduced rates by 25 basis points in October, its second cut of 2025, Powell hinted that additional cuts this year are unlikely.
In the international market, spot gold fell 0.4% to $3,983.87 per ounce, while US gold futures for December delivery dropped 0.5% to $3,994.10 per ounce.
Gold prices have pulled back nearly 10% since hitting an all-time high of $4,381.21 per ounce on October 20, as investors reassess global monetary policy outlooks.
Analysts note that easing US-China trade tensions have also reduced demand for safe-haven assets.
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Analysts expect MCX Gold to face resistance around Rs. 1,21,500 and support near Rs. 1,20,500 in the near term. Volatility is expected to persist as traders respond to inflation data and Fed commentary.
Gold remains a strategic hedge against uncertainty, despite the recent pullback, with medium-term prospects closely linked to interest rate changes and moves in the dollar.
