Gold and silver prices traded volatile on Friday, pressured by hawkish signals from the U.S. Federal Reserve and the Bank of England, but supported by rising geopolitical tensions and currency weakness in emerging markets.
The U.S. Federal Reserve held interest rates steady during its latest monetary policy meeting on Wednesday, while lowering its growth forecast for 2025. Fed Chair Jerome Powell hinted that persistent inflation, partly driven by trade tariffs, remains a key concern, which may delay the timing of any rate cuts. The Bank of England followed suit on Thursday, maintaining its benchmark rate, which further weighed on precious metal prices.
However, safe-haven demand remains intact amid the ongoing Israel-Iran conflict and a weaker U.S. dollar index. Domestically, gold and silver are also finding support from a depreciating rupee.
Meanwhile, China’s central bank, the People’s Bank of China (PBoC), kept its key lending rates unchanged on Friday. The 1-year loan prime rate (LPR) was held at 3.0% and the 5-year LPR at 3.5%, in line with market expectations. The move reflects a pause following last month’s broad monetary easing and comes amid improving sentiment around a U.S.-China trade agreement.
Adding to geopolitical concerns, U.S. President Donald Trump is expected to decide within two weeks whether to take military action against Iran, further fueling investor caution and safe-haven inflows into gold.
World Gold Council Report Highlights:
- Gold prices have gained over 30% year-to-date, recovering from a brief correction in May.
- Jewellery demand has softened, but physical investment remains strong, and gold-backed lending continues to rise.
- Gold ETFs posted modest inflows in May, breaking a two-month streak of outflows.
- The Reserve Bank of India paused its gold purchases, but gold’s share in India’s foreign exchange reserves rose to 12%.
- Gold imports declined in May, totaling US$2.5 billion, down 13% y/y and 18% from April. Estimated volumes stood between 27 to 32 tonnes, compared to 35t in April and 41t in May 2024, indicating softer domestic demand.
Expert View:
Manoj Kumar Jain, Director at Prithvi Finmart, said:
“We expect gold and silver prices to remain volatile in today’s session amid fluctuations in the dollar index and heightened geopolitical tensions. Gold may hold its support near $3,330 per troy ounce, while silver could stabilize above $35.00 on a weekly closing basis.”
Technical Levels to Watch:
COMEX Gold:
- Support: $3,366 – $3,330
- Resistance: $3,404 – $3,427
COMEX Silver:
- Support: $36.00 – $35.55
- Resistance: $36.70 – $37.15
MCX Gold (₹):
- Support: ₹98,800 – ₹98,550
- Resistance: ₹98,660 – ₹99,000
MCX Silver (₹):
- Support: ₹1,06,500 – ₹1,05,750
- Resistance: ₹1,08,200 – ₹1,09,000
Kedia Commodity Outlook:
Gold futures are undergoing long liquidation, with open interest dropping by 2.33% to 14,601. Immediate support is seen at ₹98,815, with potential downside toward ₹98,300. Resistance lies at ₹99,705, and a breakout could push prices toward ₹1,00,080.
Silver futures are also under pressure, with open interest falling 9.87% to 14,366. Key support is at ₹1,06,725, and a break below may open the door to ₹1,06,050. On the upside, resistance is at ₹1,08,260, with the potential for an advance to ₹1,09,120.
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Disclaimer:
The information provided in this article is for informational purposes only and reflects the views of industry experts. Before making any investment decisions, it is recommended that you consult a financial advisor. The team at Gold Price Today does not engage in personal buying, selling, or trading of gold or silver on exchanges. We are not responsible for any gains or losses incurred based on the information presented here.
