Gold, silver rates in Delhi, Mumbai, Kolkata Chennai: Gold falls below Rs 1.60 lakh; silver slides sharply

Gold and silver prices remained under pressure on May 16 as global uncertainty and a stronger US dollar weighed on investor sentiment. Precious metals saw notable fluctuations in domestic and international markets, with silver recording a steeper decline than gold. Despite the correction, prices continued to hover near elevated levels, reflecting persistent volatility in the bullion market.

Investors closely tracked global developments, currency movements and broader economic signals as precious metals reacted to changing market dynamics. Analysts noted that while gold traditionally acts as a safe-haven asset during periods of uncertainty, stronger dollar movements often create short-term pressure on prices.

Gold futures decline

On the Multi Commodity Exchange (MCX), gold futures for June delivery declined sharply during Friday’s session. Gold futures fell as much as 1.52%, or Rs 2,478, touching an intraday low of Rs 1,59,500. At the last reported level, the yellow metal was trading at Rs 1,59,792, down Rs 2,186 or 1.34%. Gold also touched an intraday high of Rs 1,60,992 before giving up gains amid selling pressure.

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Silver witnessed a much sharper correction. MCX silver futures for July delivery plunged by 4.12%, or nearly Rs 12,000, to touch Rs 2,79,102. The fall reflected broader weakness in precious metals and heightened sensitivity to global market movements.

Market participants said that currency movements and profit-booking after recent gains contributed to the decline.

City-wise gold rates

Despite weakness in futures trading, retail gold prices across Indian cities remained close to record levels.

In New Delhi, 24-carat gold was priced at Rs 15,805 per gram, while 22-carat gold stood at Rs 14,489 and 18-carat gold at Rs 11,857 per gram. In Mumbai, 24-carat gold traded at Rs 15,790 per gram and 22-carat gold at Rs 14,474. Chennai continued to command higher prices, with 24-carat gold quoted at Rs 16,107 per gram. Kolkata and Bengaluru largely tracked Mumbai prices.

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For larger quantities, 10 grams of 24-carat gold was priced at Rs 1,57,900, marginally lower by Rs 10 from the previous session. Similarly, 10 grams of 22-carat gold was available at Rs 1,44,740.

What drives gold prices?

Gold prices in India are determined by a mix of international and domestic factors. Global gold prices, movements in the US dollar, inflation expectations, interest rate trends and geopolitical developments all influence bullion rates. Domestic factors such as jewellery demand, festive buying and import costs also affect retail prices.

Periods of uncertainty often increase demand for safe-haven assets such as gold. However, a stronger dollar typically makes gold more expensive for overseas buyers, putting pressure on prices.

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Silver prices remain elevated

Silver prices also stayed at elevated levels despite the sharp fall in futures trading. The metal was trading at Rs 289.80 per gram and Rs 2,89,900 per kilogram in India. Chennai reported silver rates at Rs 3,04,900 per kilogram, while Mumbai and New Delhi quoted prices at Rs 2,89,900 per kilogram. Hyderabad and Kerala also recorded rates similar to Chennai.

The government has also increased import duty on gold and silver to 15% from 6% earlier to curb non-essential imports and manage rising import costs. Analysts believe such measures, along with global developments, could continue influencing bullion prices in the coming weeks.