Gold prices drop sharply by Rs 2,375 per 10 grams; silver also falls

The price of 24-carat gold fell by Rs 2,375 per 10 grams, bringing it down to Rs 91,484 from Rs 93,859, according to the India Bullion and Jewellers Association (IBJA).

The decline wasn't limited to just 24-carat gold. The price of 22-carat gold also dropped, now standing at Rs 83,799 per 10 grams, down from Rs 85,975.

Similarly, 18-carat gold saw its price fall to Rs 68,613 from Rs 70,394 per 10 grams.

This marks a sharp turnaround from just a few weeks ago, when on April 22, the price of 24-carat gold had surged close to the Rs 1 lakh mark.

Silver too mirrored the downtrend that was being faced by the yellow metal.

Prices for one kilogram of silver declined by Rs 2,297 to Rs 94,103 from Rs 96,400 per kg.

The decline in precious metal prices extended to the futures market in the country as well.

On the Multi Commodity Exchange (MCX), gold futures for June 5, fell 1 per cent to Rs 91,325, while silver futures for July 4, dropped by a similar margin to Rs 94,458 per kg.

Market analysts attribute this fall in gold prices to easing tensions in global trade, particularly between the United States and China, which had earlier set the prices of the yellow and silver metals skyrocketing.

As geopolitical uncertainty decreases, the appeal of safe-haven assets like gold tends to weaken.

In international markets, gold has dropped to its lowest level in a month. On COMEX, gold was trading down by 1.1 per cent at $3,141.35 per ounce.

This is a steep drop from its recent peak of around $3,500 per ounce seen on April 22.

The sudden drop in gold and silver prices could spur demand in the domestic market, especially with the wedding season ongoing and Akshaya Tritiya just past -- both traditionally strong periods for gold purchases.