Gold and Silver Prices Decline as Investors Cash In on Gains

Gold and silver prices experienced significant declines in futures trading on October 24, 2023, as traders opted to book profits following recent gains. This downturn was influenced by a stronger US dollar and growing optimism regarding US-China trade negotiations.

On the Multi Commodity Exchange (MCX), gold futures for December delivery fell by Rs 1,109, or 0.89 percent, settling at Rs 1,22,995 per 10 grams. The February 2026 contract also saw a decrease of Rs 1,075, or 0.86 percent, closing at Rs 1,24,200 per 10 grams. Silver futures were similarly affected, with the December delivery price plunging by Rs 2,683, or 1.81 percent, down to Rs 1,45,829 per kilogram. The March 2026 contract for silver dropped by Rs 2,206, or 1.47 percent, to Rs 1,47,878 per kilogram.

Darshan Desai, CEO of Aspect Bullion & Refinery, commented on the market movements, stating, “Gold prices dropped in the futures market as investors booked profits amid stretched valuations and renewed optimism over a potential US-China trade deal.” The dollar index, which measures the strength of the US dollar against a basket of six currencies, rose by 0.11 percent, reaching 99.05.

Analysts noted that the precious metals lost momentum as both the US dollar and Treasury bond yields gained traction. Key events, including updates on the US government shutdown and the forthcoming meeting between President Donald Trump and Chinese President Xi Jinping, are expected to influence market dynamics. According to Desai, a successful trade agreement could exert additional downward pressure on gold prices, while escalating US-Russia tensions might provide support at lower price levels.

In international markets, Comex gold futures for December delivery fell by USD 20.61, or 0.50 percent, to USD 4,124.99 per ounce on the same day, following a nearly 2 percent rise in the previous session. Senior Research Analyst at Reliance Securities, Jigar Trivedi, observed that gold prices dropped significantly, marking an end to a nine-week winning streak, as heavy selling followed repeated record highs in recent sessions.

Trivedi highlighted that gold had experienced a decline of more than 5 percent earlier in the week, representing its largest intraday loss in five years, coinciding with notable withdrawals from gold-backed Exchange Traded Funds (ETFs). This drop marked the most substantial single-day reduction in holdings by tonnage in five months. Despite this volatility, gold remains up more than 50 percent year-to-date, largely driven by ongoing trade tensions.

Silver futures also faced pressure, with the December delivery price declining by 1.06 percent to USD 48.19 per ounce in overseas markets, following a 2.15 percent increase previously. Geopolitical risks continue to loom large, particularly following new US sanctions on Russia aimed at pressuring Moscow regarding a ceasefire in Ukraine.

Trivedi noted that expectations for the Federal Reserve to implement two additional rate cuts by the end of the year are contributing to support for bullion. Investors are closely monitoring the upcoming US Consumer Price Inflation (CPI) index report, which could influence the outlook for monetary policy in the near future.