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Informist, Thursday, May 21, 2026

 

By Reshma Ravi

 

MUMBAI – Futures contracts of gold and silver fell on the Multi Commodity Exchange of India and the COMEX Thursday on expectations of interest rate hikes after the minutes of the US Federal Open Market Committee's April meeting showed hawkish remarks from officials, analysts said. Precious metal futures on the domestic exchange also fell as the rupee strengthened against the dollar. However, the fall in prices could be limited by renewed optimism about a potential US-Iran peace deal. 

 

At 1859 IST, the most active June contract of GOLD was down 0.8% at INR 158,764 per 10 grams on the MCX. The same-month contract on the COMEX was down 0.8% at $4,496.5 per ounce. The most active July SILVER contract on the MCX was down 1.6% at INR 275,115 per kilogram, and the same-month contract on COMEX was down 1.7% at $74.89 per ounce.

The rupee on Thursday closed at 96.2000, up 0.6% against the US dollar. When the rupee moves against the dollar, prices of gold and silver in the domestic market adjust as the precious metals are priced in rupees.

 

Gold and silver prices fell after minutes of the US FOMC meeting revealed that the majority of officials would be open to interest-rate increases if the war in Iran continued to fuel inflation, Manoj Jain, director of Prithvi Finmart, said. Federal Reserve officials indicated that additional policy tightening could become necessary if inflation remained persistently above the 2% target, according to minutes of the April FOMC meeting. Typically, higher interest rates dim the appeal of the non-interest-bearing precious metal. 

 

Gold has fallen more than 14% since the war began in late February, as the non-yielding metal tends to decline on expectations of higher interest rates, analysts at Kedia Advisory said. 

 

However, losses in gold and silver prices are likely to be limited as concerns about a further rise in inflation eased amid signs of progress in negotiations between the US and Iran, analysts said. US President Donald Trump said Washington was in the "final stages" of negotiations with Iran, lifting the market sentiment. The US dollar and Treasury yields retreated from their highs on Wednesday amid rising hopes that the US was nearing a deal with Iran, Bloomberg reported, which also limited losses in precious metal prices.

 

"We expect gold and silver prices to remain volatile this week amid volatility in the dollar index, volatility in the crude oil prices and the US-Iran peace deal uncertainty," Manoj Jain said. 

 

Outlook for the rest of the session:

--MCX gold seen at INR 157,000–INR 161,000 per 10 grams

--COMEX gold seen at $4,480–$4,580 an ounce

--MCX silver seen at INR 269,000-INR 281,000 per kg

--COMEX silver seen at $72.00-$79.00 an ounce

 

End

 

US$1 = INR 96.20

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

 

Edited by Saji George Titus

 

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