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Gold, Silver Prices Fall as Safe-Haven Demand Weakens, Dollar Rises

Gold and silver prices declined for a second consecutive session as investors parsed mixed US economic data for clues on the Federal Reserve's monetary policy path. The dollar strengthened, making bullion more expensive for holders of other currencies, while spot gold fell below the $5,000 per ounce mark. Analysts note that easing geopolitical tensions, including progress on US-Iran talks, have reduced safe-haven demand for precious metals. However, the broader trend remains supported by factors like central bank buying and investor flight from traditional assets.

Key Points: Gold, Silver Prices Decline Amid Mixed US Data, Fed Watch

  • Gold futures dip 0.56%
  • Silver futures fall 1.18%
  • Dollar index surges 0.21%
  • Spot gold below $5,000/oz
  • Easing geopolitical tensions reduce demand
2 min read

Gold, silver prices continue to decline amid weakening safe haven demand

Gold and silver prices drop for second session as dollar strengthens and investors assess mixed US inflation and jobs data for Fed rate cues.

"Gold has support at Rs 1,45,000 and Rs 1,50,000 while resistance at Rs 1,60,800 and Rs 1,65,000. - Analyst"

New Delhi, Feb 17

Gold and silver prices declined for a second consecutive session on Tuesday, as investors analysed mixed US economic data and waited for cues on the US Federal Reserve's policy path.

MCX gold April futures dipped 0.56 per cent to Rs 1,53,889 per 10 grams on an intra-day basis. Meanwhile, MCX silver March futures declined 1.18 per cent to Rs 2,37,064 per kg.

Investors remain undecided on whether softer inflation readings will eventually translate into easier monetary policy or whether stronger labour market data will keep rates higher for longer, analysts said.

The dollar index surged 0.21 per cent to 97.12, tracking the moderation in US CPI (consumer price index) in January. A stronger dollar made greenback-priced bullion more expensive for other currency holders.

In international markets, spot gold dipped below the $5,000 mark to $4,992 an ounce and spot silver slid nearly 3 per cent. The ease in prices came as US consumer prices in January rose less than expected even as job growth surprised on the upside, complicating the outlook for near‑term rate cuts.

COMEX Gold is trading within the $4,850-$5,100 range after a sharp correction from recent highs above $5,500-$5,600, analysts said.

Ease in geopolitical tensions also reduced safe haven demand for gold as an Iranian diplomat said that Iran is seeking a nuclear agreement with the United States that would yield economic benefits for both sides.

"Gold has support at Rs 1,45,000 and Rs 1,50,000 while resistance at Rs 1,60,800 and Rs 1,65,000. MCX silver has support at Rs 2,25,000 and Rs 2,60,000, and resistance is at Rs 3,00,000 and Rs 3,25,000," an analyst said.

The broader trend in precious metal remains constructive due to ongoing geopolitical tensions, strong central bank buying, and investor flight from sovereign bonds and currencies.

Investors remain keen on cues over global liquidity conditions, US dollar movement, bond yields, progress on the US-Iran talks and ongoing negotiations to end the Russia-Ukraine war.

- IANS

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Reader Comments

R
Rohit P
The US Fed's policy has such a huge impact on our daily lives here. Gold prices going down might be good for buyers, but it shows how global economics dictates our local market.
A
Aman W
Respectfully, while the article is informative, it focuses heavily on international factors. For the common Indian investor, the more immediate concern is the high import duty on gold and how that affects the final price we pay, regardless of COMEX trends.
S
Sarah B
Interesting to see the link between geopolitical tensions and commodity prices. If US-Iran talks progress, it could mean more stability and even lower prices. A silver lining, perhaps? 😊
V
Vikram M
Gold at 1.53 lakhs per 10gm is still very high for middle-class families. This "dip" doesn't feel like much when you consider prices from 5 years ago. It remains a long-term investment, not for quick profits.
K
Kavya N
My father always says, "Sonay ki chamak kabhi kam nahi hoti" (The shine of gold never fades). Short-term fluctuations happen, but in India, gold is forever. It's not just an investment, it's family security.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

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