Precious metal prices in India faced another wave of severe selling pressure, marking the second consecutive day of substantial declines. The drop comes on the heels of weak global cues and shifting expectations regarding monetary policy adjustments by major central banks.
Global Spot Markets Witness Steep Declines
Spot gold tumbled to its weekly low of $4,560 per ounce following a hawkish speech delivered by US Fed chair Kevin Warsh at Jackson Hole. The remarks significantly elevated the probability of an interest rate hike in September to nearly 50%. Meanwhile, spot silver experienced a steep drop of 4.5%, settling at $66 per ounce in the wake of the speech.
MCX Futures Crash Overnight
Domestic futures trading mirrored the international sentiment. At the Multi Commodity Exchange, both gold and silver futures crashed by nearly 2% overnight. MCX gold is currently hovering around Rs 1,56,400 per 10 grams, while MCX silver dropped down to Rs 2,36,651 per 1kg.
US Fed Chair Signals Persistent Inflation Pressures
Delivering his first major speech since taking the chair in May, Kevin Warsh cautioned that inflation has not slowed down meaningfully. He emphasized that policymakers require clearer evidence of underlying price pressures easing, warning that the central bank still has significant work ahead if conditions do not change. Reaffirming the Fed's commitment to the 2% inflation target as a firm and fixed goal, he noted that current financial conditions are not restrictive enough. These closely watched remarks provided much-needed clarity on his economic perspective following earlier market criticism over limited guidance.
Crude Oil Prices Remain Elevated
In the broader commodity space, crude oil prices continued to hold firm at elevated levels. Brent crude stayed well over $88 per barrel, while US WTI crude maintained a position above $83 per barrel, continuing to influence wider macroeconomic sentiment.
