Gold prices experienced a modest uptick on the Multi Commodity Exchange of India, indicating a recovery from previously oversold conditions. Nonetheless, the advancements were limited due to ongoing apprehensions that high oil prices might exacerbate inflationary pressures and prolong elevated interest rates. The Federal Reserve maintained its current interest rate levels on Wednesday. In its most divided decision since 1992, the central bank highlighted increasing inflation concerns in its policy statement, with three officials dissenting and expressing their lack of support for signaling a bias towards lower borrowing costs.
The decision has led to a significant shift in market expectations. Market participants have eliminated the possibility of any rate reductions for the remainder of this year and are now assigning a 30% likelihood to a rate increase by March 2027, a significant rise from approximately 5% just a day prior. In the domestic market, MCX silver futures for July 2026 delivery increased by Rs 2,700, or 1%, reaching Rs 2,40,908 per kg. Gold futures for June 2026 delivery remained stable at Rs 1,49,526 per 10 grams. In the prior session, precious metals concluded the period unchanged. Oil increased to $120, heightening concerns about inflation, which subsequently elevates the probability of increased interest rates. Gold has long been regarded as a safeguard against inflation; however, the rise in interest rates diminishes its allure by enhancing the attractiveness of yield-bearing assets.
Globally, spot gold increased by 0.7% to $4,573.09 per ounce as of 0229, following a decline to its lowest level since March 31 the previous day. U.S. gold futures for June delivery experienced an increase of 0.5%, reaching a price of $4,585.10. Among other metals, spot silver increased by 1.6% to $72.63 per ounce. Manoj Kumar Jain noted that there is significant price volatility in precious metals. He noted that silver could hold support at $68 per troy ounce, while gold may sustain support at $4,470 per troy ounce on a weekly closing basis. He anticipates that gold and silver will experience volatility this week, influenced by movements in the dollar index and crude oil prices, as well as the prevailing uncertainty surrounding critical U.S. economic data and the situation between the U.S. and Iran.
He asserts that gold finds support within the $4,522 to $4,470 range, while facing resistance at $4,600 to $4,640 per troy ounce. Silver exhibits support within the range of $70 to $68, while resistance is identified at $74.40 to $76.60 per troy ounce in the current trading session. On MCX, gold appears to be encountering support levels between Rs 1,48,400 and Rs 1,47,700, while resistance is noted in the range of Rs 1,49,800 to Rs 1,50,500. Silver exhibits support levels ranging from Rs 2,35,500 to Rs 2,33,000, while resistance is observed between Rs 2,41,000 and Rs 2,44,400.