Gold, Silver Prices Extend Losses Amid Weak Safe-Haven Demand and Fed Policy Uncertainty

New Delhi: Gold and silver prices continued their downward trend for the second consecutive session on Tuesday, as weakening safe-haven demand and mixed economic signals from the United States weighed on investor sentiment.

On the domestic front, gold futures on the Multi Commodity Exchange of India (MCX) slipped 0.56% on an intra-day basis. MCX gold April futures were trading at ₹1,53,889 per 10 grams, reflecting sustained pressure amid cautious market activity.

Similarly, silver futures also registered sharp losses. MCX silver March futures declined 1.18%, trading at ₹2,37,064 per kilogram during the session. The fall in silver prices mirrored global trends, where precious metals faced selling pressure due to reduced risk aversion among investors.

Market analysts attribute the decline to easing safe-haven demand. Gold and silver are traditionally considered safe investment options during periods of economic or geopolitical uncertainty. However, with investors closely monitoring mixed US economic data, markets appear to be reassessing the near-term outlook.

Traders are particularly awaiting clearer signals from the US Federal Reserve regarding its future monetary policy stance. Recent economic indicators from the US have painted a mixed picture, leading to uncertainty over the timing and pace of potential interest rate adjustments.

Higher interest rates typically make non-yielding assets like gold less attractive, as investors shift toward interest-bearing instruments. The possibility of a prolonged higher-rate environment has therefore limited upside momentum in precious metals.

Globally, gold prices have also faced resistance as the US dollar remained relatively firm, further pressuring bullion prices. A stronger dollar generally makes gold more expensive for holders of other currencies, reducing international demand.

Despite the short-term correction, market experts suggest that volatility may persist until clearer policy guidance emerges from the Federal Reserve. Investors are expected to keep a close watch on upcoming inflation data, employment figures, and central bank commentary for further direction.

For now, both gold and silver remain under pressure, with market participants adopting a cautious approach amid evolving global economic signals.