Gold June futures on the MCX fell by Rs 4,000/10 grams (4%), opening at Rs 95,316/10 grams on Tuesday, after reaching a record high of Rs 99,358/10 grams last week.
Silver May futures saw a slight decline, beginning at Rs 96,255/kg, down Rs 209 or 0.22%.
Given the inverse relationship between gold prices and dollar values, a decline in gold prices is correlated with a strengthening dollar.
In addition to adopting a less combative posture toward China and reaffirming his intention to retain Federal Reserve Chair Jerome Powell, US President Donald Trump also changed his stance on reciprocal tariffs, postponing their implementation until July.
The US Dollar Index, or DXY, rose to 99.13, a 0.12% increase.
According to Prithviraj Kothari, Managing Director of RiddiSiddhi Bullions, retail activity is still robust ahead of Akshaya Tritiya 2025, with a substantial customer base, particularly in southern India where the celebration has cultural significance.
According to the report, he discovered that higher prices have influenced purchasing habits, with customers preferring lighter jewelry and coins over heavier ones. Retailers are adapting by launching new collections, lowering production costs, and promoting silver alternatives.
Indian consumers buy gold at record levels during the festival season, which traditionally boosts domestic sales. Gold has both acquisition and auspicious significance.
Colin Shah, MD of Kama Jewelry, stated, "We anticipate a 10-15% increase in jewelry sales this season, driven by strong buying sentiments and price dynamics."
Shah encourages customers to think about buying jewelry now as gold prices are at all-time highs and more price increases are anticipated soon.
Both domestic and foreign trading on Monday saw strong performance from the gold and silver markets. While May silver futures closed at Rs 96,464 per kilogram, up 0.02%, June gold futures settled at Rs 96,025 per 10 grams, up 1.09%.
Increased tensions between India and Pakistan after a terrorist attack in Jammu and Kashmir were blamed for Monday's price increase, which led to a rise in safe-haven investment in precious metals.
"Gold and silver prices rose as the number of casualties from the Iranian port attack reached 70. Pakistan's nuclear threats against India have raised global market risk sentiment, resulting in increased safe-haven investment in precious metals, according to Manoj Kumar Jain of Prithvifinmart Commodity Research.
"We expect gold and silver prices to remain volatile this week due to dollar index fluctuations and upcoming US economic data releases. "Gold is expected to maintain support at $3,200 per troy ounce, while silver is expected to hold at $31.40 per troy ounce on weekly closings," he added.
