Gold and silver prices fell today in futures market in India in tandem with a decline in global markets. On MCX, December gold futures fell 0.45% to ₹51,100 per 10 gram while silver futures declined 1.2% to ₹62,847 per kg. In the previous session, gold had risen 0.7% as it extended gains to the third day while silver rates on MCX had advanced 0.7%.
In global markets, gold prices edged lower amid uncertainty over US stimulus package. Concerns emerged that an agreement on a new US fiscal coronavirus aid package will not be reached until after the presidential election when President Donald Trump accused the Democrats of being unwilling to craft a compromise on aid. US bond yields also edged higher.
But reports said that House Speaker Nancy Pelosi continued talks with White House representatives over the stimulus package. Gold is considered a hedge against inflation and currency debasement.
Spot gold fell 0.2% to $1,920.86 per ounce, falling from a one-week high of $1,931.01 hit in the previous session.
Gold was also pressurized by a steady dollar. The dollar index jumped 0.21%, dimming bullion’s appeal for other currency holders.
Among other precious metals, silver fell 0.4% to $24.96 per ounce, while platinum rose 0.2% to $887.74.
In global markets, gold had hit an all-time peak of $2,072.50 an ounce in August this year as central banks responded to economic slowdown and the new coronavirus by cutting interest rates and pumping money into markets, which boosted gold by lowering returns on bonds and raising the threat of inflation.
In India, gold had touched ₹56,200 per 10 gram on August 7.
Investors will continue to monitor developments into the relief stimulus package by the US, said Jigar Trivedi, Research Analyst- Commodities Fundamental, Anand Rathi Shares & Stock Brokers.
Gold ETF investors continued to remain on the sidelines. Holdings of the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, fell 0.1% to 1,269.35 tonnes on Wednesday from 1,269.93 tonnes on Tuesday.
Gold traders will also be watching for progress in Britain-EU trade talks as the two side resume talks to protect billions of dollars worth of trade from the beginning of next year.
