Gold prices will remain sensitive to developments in West Asia, movement in crude oil prices, and a series of key economic data releases in the coming week, analysts said.
Investors will monitor trade and inflation data from China and the US, mid-month Washington’s consumer sentiment figures and India’s Consumer Price Index (CPI) readings.
The European Central Bank’s monetary policy decision will also be in focus as market participants assess their impact on bullion and other commodities, they added.
“Momentum for precious metals such as gold and silver still looks corrective,” Pranav Mer, Vice President, EBG — Commodity & Currency Research, JM Financial Services Ltd, said.
Domestic commodity markets ended the week lower, with MCX gold futures for August delivery falling Rs 5,317, or 3.3%, to Rs 1.55 lakh per 10 grams.
ALSO READ: Silver Slumps Nearly 7% To Below $70/Ounce; Gold Tumbles 5% On Fed Pivot Jitters; Check MCX Rates
Silver for July delivery fell Rs 18,461, or 7%, to Rs 2.48 lakh per kilogram on the Multi Commodity Exchange (MCX).
“Gold witnessed a weak performance last week as rising crude oil prices diverted market attention away from safe-haven assets,” Jateen Trivedi, VP Research Analyst, Commodity and Currency, LKP Securities, said.
The rupee strengthened against the US dollar, adding further pressure on precious metals. As a result, domestic bullion underperformed than its international counterpart, with currency gains offsetting part of the support from global gold prices, he added.
In the global markets, Comex gold futures shed $227.7, or 5%, to end the week at $4,365 per ounce, while silver fell $6.77, or nearly 9%, to $69.10 per ounce.
Gold prices faced pressure in the overseas trade and closed the week down nearly 55, while silver, too, sold-off sharply tracking a sharp corrective move in industrial metals, Mer said.
“Stronger-than-expected US PMI and labour market data reinforced expectations of higher-for-longer interest rates, while a firm US dollar and exchange traded fund outflows weighed on bullion,” he added.
According to analysts, indications from Russian-Ukrainian leaders that the conflict could end soon have reduced the demand for bullion.
Going ahead, precious metals may remain vulnerable if international prices stay below the $4,400-4,500 per ounce range, while a firm rupee, elevated crude oil prices and cautious investor sentiment could cap any sharp recovery, Trivedi said.
ALSO READ: Nippon India MF Restricts Large Investments In Gold ETF, Savings Fund As Top AMCs Curb Inflows