Synopsis: Gold and silver traded in a mixed pattern on Tuesday, with international spot prices and MCX futures inching higher in early trade even as retail 24-karat gold rates across Indian cities slipped from Monday’s levels, as investors stayed cautious ahead of the US CPI inflation print due later in the day.
International precious metal prices traded higher on Tuesday morning, supported by continued investor interest in safe-haven assets. Spot gold rose 0.42 percent to $4,022.60 per ounce, while spot silver remained largely unchanged at $57.97 per ounce during Comex trading hours.
Domestic futures also witnessed strong buying momentum. MCX August gold futures climbed 0.6 percent to Rs. 1,41,144 per 10 grams, while September silver futures gained 0.59 percent to Rs. 2,19,005 per kg. Later in the session, gold and silver extended their gains further.
By late morning trade, MCX gold was trading around Rs. 1,41,340 per 10 grams, up nearly 1 percent intraday. Silver outperformed, rising to around Rs. 2,21,600 per kg, up 1.45 percent, with increasing open interest indicating fresh long positions in the contract.
In contrast, retail bullion prices moved lower on Tuesday. The national average price of 24-karat gold declined by Rs. 1,420 to Rs. 1,42,900 per 10 grams, while 22-karat and 18-karat gold prices fell to Rs. 1,30,990 and Rs. 1,07,170, respectively.
Among major cities, Chennai recorded the highest 24-karat gold price at Rs. 1,43,990 per 10 grams, followed by Delhi at Rs. 1,43,050. Mumbai, Kolkata, Bengaluru, Hyderabad, Kerala and Pune quoted prices close to the national benchmark of Rs. 1,42,900 per 10 grams.
What’s Driving Bullion?
Investor sentiment remained cautious after the failure of US-Iran ceasefire talks, which increased geopolitical uncertainty in the Middle East. The developments initially strengthened the US dollar and pressured precious metals, although ongoing regional tensions continued to support safe-haven demand for gold and silver.
This combination of stronger dollar dynamics and safe-haven buying has kept gold prices moving in a volatile range over recent sessions. Bullion prices have largely remained near record highs, with traders awaiting fresh triggers before taking significant directional positions.
Market participants also noted that physical demand has remained healthy, particularly from the jewellery segment during the ongoing wedding season in India. Strong retail buying has helped provide support to prices despite uncertainty surrounding global interest rates and geopolitical developments.
The major event being watched by bullion markets this week is the release of US Consumer Price Index (CPI) inflation data later on Tuesday. The inflation reading is expected to play a key role in shaping expectations regarding future Federal Reserve interest rate decisions.
According to Jateen Trivedi, VP Research Analyst at LKP Securities, a higher-than-expected inflation print could strengthen the dollar and keep pressure on gold prices. Conversely, softer inflation data may support a recovery, with immediate MCX Gold support seen at Rs. 1,40,000-1,40,500 and resistance near Rs. 1,44,500.
Silver has shown more pronounced volatility than gold in recent sessions, with MCX silver futures posting a stronger intraday gain of nearly 1.5% against gold’s roughly 1% move, and open interest data showing a long buildup, typically a signal of fresh bullish positioning rather than short-covering. This comes against a backdrop of tightening physical silver markets, with import curbs reportedly creating shortages and pushing premiums to a six-month high in recent weeks.
Why It Matters for Investors
For Indian investors, the divergence between rising futures and softer retail benchmarks is a reminder that jewellery buyers and gold ETF or futures investors are often looking at prices measured at different points in the trading day, and short-term dips in city-level retail rates don’t necessarily signal a reversal in the broader futures trend.
Technical indicators on gold currently point to a bearish trend, with moving averages across the 5, 10, 20, 50 and 100-day periods all sitting above the current price, and silver’s technical picture showing a similarly bearish rating despite the day’s positive price move, a divergence that suggests the recent bounce is happening within a broader corrective trend rather than a confirmed reversal.
With gold ETFs recently posting Rs. 3,443 crore in inflows after a surprise outflow in May, domestic investor appetite for bullion as a hedge appears to be holding up even as some analysts, including HSBC, have flagged that gold may stay below record highs as a stronger dollar continues to weigh on prices. The next major catalyst remains this evening’s US CPI print, which markets will parse closely for signals on whether the Federal Reserve’s rate path shifts in a direction that either supports or further pressures bullion.
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