Gold prices fell on Monday following last week’s gains, influenced by renewed tensions in West Asia, rising crude oil prices, and a stronger dollar, impacting market sentiment. Analysts suggested that Prime Minister Narendra Modi’s call to forgo non-essential gold purchases for a year might temporarily affect retail demand but is unlikely to change India’s long-term gold consumption outlook.
COMEX gold was trading near the $4,655-$4,700 per ounce mark, with silver around $79-$81 per ounce. Investors are assessing the geopolitical situation regarding the US-Iran conflict and the potential for ongoing volatility in oil markets. Gaurav Garg, a research analyst at Lemonn Markets Desk, noted that the gold price decline was exacerbated by inflation concerns stemming from rising geopolitical tensions and a noticeable increase in crude oil prices. In contrast, silver demonstrated resilience due to stable retail demand linked to the upcoming wedding season.
Manav Modi, a commodities analyst at Motilal Oswal Financial Services, indicated that gold faced pressure from a robust dollar and high oil prices, particularly after President Donald Trump deemed Tehran’s counteroffer “totally unacceptable,” heightening worries over the Strait of Hormuz conflicts. Kaynat Chainwala, AVP – Commodity Research at Kotak Securities, observed that despite the bullish market sentiment following strong US job figures last week, renewed geopolitical tensions shifted market attitudes to a risk-averse stance. She predicts COMEX gold may remain in the $4,400-$4,800 range, while silver could fluctuate between $70 and $85 per ounce.
Renisha Chainani, Head of Research at Augmont, expressed that gold and silver had hit the upper limits of their recent trading ranges and might experience profit-booking pressure. She anticipates gold will consolidate between $4,500 and $4,750, with silver trading between $71 and $82.
Prithviraj Kothari, Managing Director at RiddiSiddhi Bullions Ltd. and President of the India Bullion and Jewellers Association, echoed thoughts on potential consolidation following last week’s rally, setting expectations that gold may range between $4,550 and $4,750.
Analysts pointed out the growing influence of US interest rate expectations, bond yields, and dollar movement on bullion prices. Virat Jagad, Senior Technical Research Analyst at Bonanza, remarked that gold is under pressure from a strong dollar, increasing bond yields, and delayed US Federal Reserve rate cuts. He described the recent price corrections as part of a broader consolidation phase within a longer-term bullish trend. Ruchit Thakur, Market Analyst at VT Markets, likened gold’s current market position to a “macro tug-of-war” influenced by safe-haven demand and pressures from higher real yields and a stronger dollar.
Deveya Gaglani, Senior Research Analyst – Commodities at Axis Direct, observed that high crude oil prices and stronger than expected US non-farm payroll data have dampened the immediate attractiveness of precious metals, predicting gold may remain range-bound with robust support around ₹1,48,000 on MCX. N.S. Ramaswamy, Head of Commodity & CRM at Ventura, noted that higher interest rates and tighter financial conditions are short-term obstacles for gold, although a weakening US dollar and ongoing central bank acquisitions support longer-term prospects.
Modi’s appeal to delay non-essential gold purchases has also garnered attention amid India’s rising crude oil prices and current account deficit pressures. Jateen Trivedi, VP Research Analyst – Commodity and Currency at LKP Securities, classified this appeal as an effort to maintain macroeconomic stability and manage imports in a globally uncertain climate. While discretionary jewelry purchases could slow temporarily, Trivedi indicated that long-term demand for gold in India, driven by cultural and investment factors, is unlikely to diminish.
Ramaswamy mentioned that this appeal seems directed at reducing physical gold consumption, potentially prompting investors to consider alternatives such as Gold ETFs and Electronic Gold Receipts (EGRs). He also remarked that retail investors typically view price corrections as buying opportunities. Kothari emphasized that India’s soaring gold import bill exerts pressure on the nation’s external balance and advocated for recycling idle household gold and embracing digital gold solutions to lessen import reliance.
Dr. V.K. Vijayakumar, Chief Investment Strategist at Geojit Investments, characterized Modi’s appeal as a short-term austerity measure linked to high crude oil prices and the conflict in West Asia. He maintained that while gold demand relating to weddings and traditions is unlikely to wane, investment interest may short-term soften.
In addition, analysts highlighted persistent volatility in industrial metals due to concerns over global growth and geopolitical instability. Chainani noted that copper, aluminum, and zinc may remain sensitive to developments in the Hormuz region; however, aluminum is also facing support from supply disruptions and increased energy costs. Ramaswamy identified copper as a strong long-term investment, driven by demand from electric vehicles and renewable energy, while silver benefits from both safe-haven interest and industrial applications. Market participants are closely monitoring US inflation data, retail sales figures, Federal Reserve commentary, crude oil prices, and further geopolitical events for guidance in the bullion and commodity markets throughout the week.
