Gold Price Down to INR 51,306:Here's the gold price prediction for Indian Markets in the coming weeks

Gold price in India noticed a sharp drop on 13 June 2022. This phenomenon is not solely Indian but rather it is a global effect. Gold price future dropped 0.76% to INR 51,306 on the Multi-Commodity Exchange (MCX).

A sharp fall in Gold Price to INR 51306

Gold price in India noticed a sharp drop on 13 June 2022. This phenomenon is not solely Indian but rather it is a global effect. Gold price future dropped 0.76% to INR 51,306 on the Multi-Commodity Exchange (MCX). This drop is for 10 grams of gold on Monday, June 13. 

This current downswing is not restricted to gold alone, but silver and precious metals have also felt its heat. A tumbling of nearly 1.50% was noticed in precious metal future to INR 61,015 for a kilogram on 13 June 2022. 

Reason for this Drop in Gold Price in India?

In May 2022, inflation in the United States increased to 8.6%. As per the US labour department report, this inflation in the US was the highest in 40 years. Financial analysts around the world expect a significant surge in interest rates by the United States Federal Reserve. This surge is expected in the coming months with the aim of regulating inflation. 

There was advancing of Comex gold prices to more than 1% on 10 June. According to ICICI Direct, this happened due to the following reasons:

  • Inflation data was higher than expected. 
  • Risk aversion attitude in global markets. 

The benchmark US 10-year treasury yield also got lifted due to the high inflation. Similarly, the dollar index also got lifted. The highest level was reached by this benchmark yield on 13 June. A similar escalation was noticed by the US dollar index. 

Gold Price Future: What to Anticipate

In the future, the expectation is that there will be trading of MCX gold prices with positivity biases. This anticipation is due to the following concerns:

  • Elevated inflation 
  • Geopolitical uncertainty

In short, this indicates a slight improvement in gold prices for the Indian market in the coming weeks. Currently, the MCX gold prices are trading at INR 51,315 resistance levels. If this level sustains for long enough, we can expect an increase to INR 52,000 soon. This will also affect the silver prices which are expected to reach INR 63,500 levels. This data was reported by ICICI Direct. 

The beginning of COMEX gold prices on early 13 June had been weak. With the US Federal Reserve expected to follow an aggressive regulatory approach, the dollar strength will improve in the coming days. This will have a positive effect on the Indian Gold market.

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