Gold prices in India dipped below Rs 95,000, hitting a one-week low on Monday, as easing geopolitical tensions and positive developments in global trade talks weighed on the metal’s value.
Gold prices have dropped by Rs 2,500 per 10 grams since the India-Pakistan ceasefire was declared, with the yellow metal now trading at Rs 93,976, marking a 2.6% decline from the previous day’s closing price of Rs 96,518. Gold futures for June contracts are also down, trading at Rs 93,959, a 2.65% drop.
The easing of tensions at the India-Pakistan border, following the ceasefire announcement, has subdued the geopolitical risk premium that had previously supported gold prices. Meanwhile, in the international markets, gold also faced downward pressure as optimism around US-China trade talks dampened demand for safe-haven assets. On Monday, gold fell more than 1.5%, reaching $3,273, its lowest level in a week.
US-China Trade Deal Impact
A breakthrough in US-China trade talks has further impacted gold’s appeal. The US administration, following two days of negotiations in Switzerland, has expressed optimism about reducing tariffs and addressing trade imbalances. Treasury Secretary Scott Bessent called the talks “productive” and indicated more details would be shared soon. Analysts believe that if tensions continue to ease or tariffs are reduced, gold prices could face further declines.
US Dollar Strength and Fed Decision Add Pressure
The strength of the US Dollar, supported by last week’s Federal Reserve decision to keep interest rates unchanged, has also contributed to gold’s weakness. The US Dollar has regained strength, moving above the 100 mark, further pressuring gold prices.
Gold Price Outlook
Experts suggest that if gold prices remain below $3,365 (Rs 94,000) this week, the yellow metal could drop to $3,200 (Rs 92,000). A break below this level could push gold prices further down to $3,000 (Rs 86,000), according to Dr. Renisha Chainani, Head of Research at Augmont.
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