New Delhi: Gold and silver prices pulled back from their record highs in futures trading on Wednesday as traders booked profits at elevated levels, dragging the precious metals lower. Markets were also digesting cautious remarks from US Federal Reserve Chair Jerome Powell regarding the outlook for potential interest rate cuts.
On the Multi Commodity Exchange (MCX), gold futures for October delivery dropped Rs 408, or 0.36%, to Rs 1,13,428 per 10 grams. This came after the metal hit an all-time high of Rs 1,14,179 per 10 grams on Tuesday. Similarly, the December contract for gold fell Rs 353, or 0.31%, to Rs 1,14,486 per 10 grams following a lifetime peak of Rs 1,15,139 per 10 grams.
Silver futures also eased, retreating from their recent highs amid profit-taking. The white metal futures for December delivery slipped Rs 221, or 0.16%, to Rs 1,34,841 per kilogram. The March contract for next year shed Rs 121, or 0.09%, to Rs 1,36,271 per kilogram.
Globally, bullion prices retreated from historic peaks. Gold futures for December delivery traded 0.44% lower at USD 3,799.07 per ounce, after touching a record high of USD 3,824.60 per ounce on Tuesday. Silver futures for December delivery also slipped 0.44%, settling at USD 44.41 per ounce.
Commodities market experts attributed the decline primarily to profit-taking and caution following Federal Reserve Chair Jerome Powell’s remarks. Powell emphasized that there is no “risk-free path” for monetary policy. He warned that cutting rates too aggressively could force the Fed to reverse course if inflation continues, while holding policy restrictive for too long could harm the labor market.
On Tuesday, Powell reiterated a balanced approach to monetary easing, cautioning that cutting rates too quickly might risk leaving “the inflation job unfinished,” whereas delaying easing for too long could unnecessarily weaken the labor market. He added that current policy remains “modestly restrictive,” allowing the Fed some room to respond to changing economic conditions.
Last week, the US central bank lowered its benchmark rate by 25 basis points. Market participants are currently pricing in the likelihood of two additional reductions before the end of the year, a factor that helped cap losses for bullion.
Meanwhile, heightened geopolitical tensions in Eastern Europe and the Middle East supported safe-haven demand, limiting the downside for gold and silver prices, analysts noted.
*Disclaimer: This story is from a syndicated feed. No changes have been made except to the headline.*
https://www.freepressjournal.in/business/gold-silver-retreat-from-peaks-amid-federal-reserves-rate-cut-uncertainty
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