Gold futures recouped early losses to trade higher at ₹1.42 lakh per 10 grams on Tuesday as market participants reassessed the US Federal Reserve's interest rate trajectory amid volatile crude oil prices and persistent geopolitical risks, according to a report by PTI.
Price Action on MCX and Comex
On the Multi Commodity Exchange (MCX), the gold contract for August delivery rose ₹196, or 0.14 per cent, to ₹1,42,598 per 10 grams after opening in negative territory. The contract had settled at ₹1,42,402 per 10 grams on Monday, PTI reported.
Internationally, Comex gold futures for the August contract edged higher to quote at $4,044.80 per ounce in New York. Gold briefly dipped below the $4,000 per ounce mark — its lowest level in nearly eight months — before recovering to around $4,040 per ounce in overseas trade, said Renisha Chainani, Head of Research at Augmont.
| Metric | Previous Close | Current Price | Change |
|---|---|---|---|
| MCX August gold (₹/10g) | ₹1,42,402 | ₹1,42,598 | +₹196 (+0.14%) |
| Comex August gold ($/oz) | — | $4,044.80 | Recovery from below $4,000 |
Drivers of the Rebound
"Gold prices experienced a notable decline in the early session but later pared all of its losses to trade higher as investors reassess the outlook for interest rates by the US Federal Reserve amid ongoing volatility in inflation and oil prices," said Gaurav Garg, Research Analyst at Lemonn Markets Desk.
Chainani attributed the rebound partly to developments in the US-Iran conflict. "The conflict between the US and Iran has intensified in recent days before both sides agreed to pause hostilities ahead of another round of peace negotiations in Doha, Qatar," she said. However, uncertainty remains after Iran reiterated its intention to retain control over shipping through the Strait of Hormuz, a critical global oil transit route, she added.
Geopolitical and Policy Context
The Strait of Hormuz is a chokepoint for about one-fifth of the world's oil supply, and any disruption there heightens risk aversion, supporting gold as a safe haven. The pause in US-Iran hostilities and the upcoming peace talks in Doha have provided some respite, but the Strait of Hormuz issue continues to hang over markets.
Outlook and Key Data Releases
Investors are now anticipating the possibility of three interest rate hikes this year by the US Fed, Chainani noted. The focus is shifting to the upcoming US jobs report for further cues on the central bank's policy path and near-term direction for precious metals, she added.
The jobs data will be closely watched by commodity traders and analysts to gauge the strength of the US economy and the Fed's likely policy response. A strong jobs report could reinforce expectations of tighter monetary policy, which tends to weigh on gold, while a weak report could renew safe-haven buying.
For commodity procurement teams and hedge fund analysts, the near-term direction of gold prices will depend on the interplay between US interest rate expectations, geopolitical developments in the Middle East, and crude oil price volatility. The August MCX contract's trajectory remains tied to international cues, with the $4,000 per ounce level acting as a key psychological support on Comex.
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