The price of gold increased on the MCX on the morning of Friday, March 27, influenced by a weaker dollar, which appears to have stimulated value purchasing in the yellow metal following its recent downturn. MCX gold June futures experienced an increase of nearly 1%, reaching Rs 1,43,829 per 10 grams, while MCX silver May contracts saw a rise of almost 2%, climbing to Rs 2,23,978 per kg during the morning session. The dollar index experienced a decline of approximately 0.10%, resulting in a slight reduction in the price of gold in foreign currencies and subsequently affecting its demand. Nevertheless, high crude oil prices stemming from ongoing uncertainty surrounding the West Asian conflict continue to pose a significant challenge for the yellow metal.
Gold prices have experienced significant fluctuations in March due to the ongoing US-Iran conflict. The conflict in West Asia has resulted in a notable increase in crude oil prices, contributing to a rise in the dollar index while exerting downward pressure on gold prices. Domestic spot gold prices have experienced a decline of nearly 9% thus far in March, according to MCX data. Gold and silver could experience a modest short-term rebound; however, surpassing recent peaks appears challenging. “While supportive geopolitics could underpin sentiment, a firm US dollar is likely to cap strong upside, keeping price movements relatively restrained for now,” stated Hareesh V.
Jateen Trivedi emphasized that the uncertainty surrounding the reopening of the Strait of Hormuz maintains the underlying risks, with the potential for crude price fluctuations remaining a consideration. The present increase seems to be characterized more by a relief rally and short covering than by any new bullish momentum. Given the ongoing geopolitical uncertainty and persistent inflation concerns, it is probable that gold will continue to exhibit volatility. “Near-term range for gold is seen between Rs 1,35,000– Rs 1,55,000,” stated Trivedi. In discussing the wider parameters for gold rates on both COMEX and MCX today, Anuj Gupta, a SEBI-registered market expert, indicated that the COMEX gold rate is situated within a broader range of $4,250 to $4,500 per ounce, whereas the MCX gold rate is positioned between Rs 1,30,000 and Rs 1,55,000 per 10 gm.
Emphasizing the significance of the Middle East crisis, Ponmudi R noted that the overall structure is exhibiting signs of recovery, bolstered by ongoing geopolitical tensions in the region, which persistently fuel safe-haven demand and offer a robust underlying support to prices. “On the upside, the 4,670–4,750 range remains an important resistance band. A sustained move above $4,750 could extend prices toward $4,850, where stronger supply pressure may emerge. On the downside, a break below $4,500 may accelerate weakness toward the $4,360–$4,400 level,” stated the Enrich Money expert.