Gold and silver prices fell flat! Amidst the severe tension in the Middle East, gold suddenly became so cheap.

New Delhi: The biggest and shocking news of this time is coming from the bullion market of the country. It is generally seen that whenever there is a war or tension somewhere in the world, the prices of gold start touching the sky. But this time, despite the deepening crisis in the Middle East (West Asia), the trend of gold has become weak. On Monday, a huge fall of Rs 1,100 was recorded in the gold prices in the bullion market of the capital Delhi, after which its price has come down to the level of Rs 1.59 lakh.

Market experts say that due to increasing tension in West Asia, the prices of crude oil have increased rapidly in the international market. Due to this surge in crude oil, investors started selling precious metals, which has a direct impact on the prices of gold and silver.

Price of 10 grams of gold came below Rs 1.59 lakh

According to local market data, the price of gold of 99.9 per cent purity in Delhi has fallen by Rs 1,100 to Rs 1,58,800 per 10 gram (including all taxes) from Friday’s closing level of Rs 1,59,900 per 10 gram.

There is relief news for those who buy gold as well as silver. Silver is also witnessing heavy selling pressure from all sides at this time. On Monday, the price of silver fell by Rs 5,000 and closed at Rs 2,55,700 per kg. Let us tell you that this is the fourth consecutive session of decline in silver. On June 2, the price of silver was at a record level of Rs 2.71 lakh per kg, in which till now there has been a huge reduction of about Rs 15,300 i.e. about 6 percent.

Know why gold and silver suddenly became cheaper

Experts believe that the sudden rise in crude oil prices has changed the entire game of precious metals like gold and silver. Generally, in times of war, people consider gold as the safest investment and invest money in it, due to which its prices increase. But this time it did not happen. Investors fear that if crude oil and energy prices continue to rise like this, inflation will increase further around the world. Due to fear of rising inflation, central banks may have to postpone the decision to cut interest rates (relaxation of monetary policy), which has reduced the shine of gold.

Commenting on this, Soumil Gandhi, Senior Analyst, Commodities, HDFC Securities, said, “Gold continued its decline on Monday, which mainly reflects the weakness in global markets due to the increasing tension between Israel and Iran. This geopolitical tension has significantly increased the concerns of investors around the world regarding the outlook for inflation and interest rates in the coming times.”

Same is the condition of foreign markets, rise in crude oil

Not only in India, but also in foreign markets, the prices of gold and silver have fallen badly. In the international market, spot gold fell by almost 1 percent to $ 4,291.79 an ounce, while silver was also trading at $ 66.93 an ounce, down 1.34 percent. Mirae Asset Sharekhan’s Commodities Head Praveen Singh said that due to strong jobs data from America and tensions in the Middle East, gold has suffered heavy losses in foreign markets.

Meanwhile, globally the prices of Brent crude oil jumped by 5 percent to $ 98.07 per barrel. However, later when Iran’s army announced the end of its military campaign against Israel, the initial rise of crude oil saw a slight decline.

Will prices reduce further in the coming days?

There is still uncertainty in the market regarding the future of gold and silver. According to reports, Iran has clearly warned that if Israel starts attacks on Lebanon again, it will launch even more severe and deadly attacks. In such a situation, Kotak Securities’ Commodity Research AVP Kainat Chainwala says that on June 10, America’s Consumer Price Index (CPI) i.e. inflation data for the month of May is going to be released, which will decide the next movement of gold.

He explained that if these inflation figures in the US come out higher than expected (hot reading), then the fear of raising interest rates by the US Federal Reserve will become stronger. If this happens, the US dollar will strengthen and the pressure on gold and silver will increase further. Overall, given the strict monetary policy and the current tension between Iran and Israel, at present the inclination of gold prices remains towards decline.