Precious metals are expected to remain under pressure in the coming week as investors weigh geopolitical uncertainty in the Middle East against upcoming inflation data and other economic indicators that could shape global interest rate expectations, according to analysts cited by Business Today.
Price Moves and Market Context
Domestic bullion prices ended sharply lower for the week. The following table summarises the key price changes:
| Contract | Exchange | Settlement Price | Weekly Change | % Change |
|---|---|---|---|---|
| Gold August futures | MCX | Rs 1.43 lakh per 10 grams | -Rs 3,900 | -2.65% |
| Silver September futures | MCX | Rs 2.22 lakh per kg | -Rs 14,746 | -6.2% |
| Gold (spot/ futures) | Comex | USD 4,113.7 per ounce | -0.3% | -0.3% |
| Silver (spot/ futures) | Comex | $60.16 per ounce | -1.5% | -1.5% |
The weakness mirrored global trends, according to Business Today. Comex gold edged down 0.3% to USD 4,113.7 an ounce, while silver lost 1.5% to $60.16 an ounce.
Geopolitical Drivers
The latest escalation between the US and Iran has renewed concerns over energy supplies after Tehran announced the closure of the Strait of Hormuz following an attack on a vessel it claimed was travelling through an unauthorised route. The conflict widened after US strikes prompted retaliatory attacks by Iran on American-linked facilities in the UAE, Kuwait, and Bahrain, according to Business Today.
While geopolitical tensions typically support safe-haven demand for gold, analysts said the current environment could have a mixed impact. A sustained rise in crude oil prices may fuel inflation, strengthen the US dollar, and push Treasury yields higher, reducing the appeal of non-yielding assets such as gold and silver.
"Gold and silver are still witnessing a corrective phase. The direction will largely depend on how the US-Iran conflict unfolds. Any major escalation is likely to lift oil prices further and support the US dollar and Treasury yields," said Pranav Mer, senior vice president, commodity and currency research, JM Financial Services, as quoted by PTI.
Macroeconomic Factors
Apart from geopolitical developments, investors are awaiting inflation readings from the US, India, and the euro area, which could provide fresh signals on the policy stance of major central banks, according to Business Today.
According to Jateen Trivedi, vice president, research analyst, commodity and currency at LKP Securities, gold struggled to hold on to short-lived gains as investors continued to lock in profits. He said a stronger US dollar, elevated crude oil prices, and expectations that interest rates could stay higher for longer kept sentiment subdued. Although a softer rupee offered some support to domestic gold prices, it was not enough to offset weakness in overseas markets.
Beyond inflation data, traders will also track US retail sales, housing numbers, and weekly jobless claims for clues on the Federal Reserve's next move. Chinese economic data, including GDP, industrial production, trade, and credit growth, will also be watched closely for their impact on the broader commodities market.
Price Outlook
Analysts believe bullion is likely to remain range-bound until markets receive a stronger trigger, either through a significant shift in geopolitical developments or fresh signals on the global interest rate outlook, according to Business Today. The direction of gold and silver prices in the coming week hinges on how the US-Iran conflict evolves and the outcome of key inflation data releases.
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