The Indian and American stock markets rode Donald Trump’s victory in the US presidential election. On the other hand, the gold market seemed to be completely clean. Everyone can guess it from the fact that the price of gold in the Indian futures market fell by more than 1850 rupees. On the other hand, the price of silver also saw a drop of more than Rs 3,800. The same situation was also observed in foreign markets. Spot gold prices fell more than $80 per ounce on the Comex market in New York. On the other hand, spot silver prices fell by around 4.50 percent.
According to experts, after Donald Trump’s victory there has been a huge rise in the dollar index. Due to which gold prices are increasing. There are also other reasons why the price of gold is falling. After three months of rising gold prices, a profit-booking environment has begun. This time, at the US Federal Reserve meeting, interest rate cuts will not be seen or may be less than expected. Apart from this, there is a significant drop in demand for gold locally. Due to which a drop in gold prices is being seen.
Now the most important question is to what extent further declines in gold prices can be seen in the coming months. In response to this, experts claim that towards the end of the year we could see a drop in the price of gold of 3 to 5 percent. This means that the gold price can reach the level of 73 to 75 thousand rupees on MCX. Let us also give you detailed information on what the price of gold has been from India to the United States after Trump’s victory and what level it can reach in the coming days.
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Main reasons for the fall of gold
- Technical profit reservation: In the last three months, gold prices have seen an increase of more than 9 percent i.e. more than Rs 6,500 times 10. Due to which technical profit bookings are seen in gold prices. On August 8, the price of gold was Rs 70,134 per ten grams. Which closed at over Rs 76,600 on August 6. Similar situations have also been observed in foreign markets.
- Volatility before the Federal Reserve meeting: On the other hand, on November 7 the US Central Bank will announce interest rates. Due to this, there is instability in gold prices. According to experts, after Donald Trump’s victory in the United States, the Federal Reserve can keep interest rates as they are or cut them by 0.25 percent less than expected. While previously the estimate was 0.50 percent. Due to which a drop in gold prices is being seen.
- Donald Trump’s victory: On the other hand, Donald Trump’s victory is also considered one of the main reasons for the decline in gold. According to experts, Donald Trump has opposed the aggressive cuts made by the Federal Reserve during his election campaign. In such a situation, a feeling has developed among investors that there will be little or no rate cut by the Fed in the coming days. This means that the cuts previously promised by the Federal Reserve will not happen in the coming days. The effect of this is visible in gold prices.
- Fall of the dollar index: On the other hand, Donald Trump has always been a supporter of the strength of the dollar. In such a situation, when Donald Trump’s victory was confirmed, the dollar index saw an increase of more than one and a half percent and reached the level of 105.14. So there will be an increase in US bond yields. For this reason, a drop in gold prices is being observed from India to the United States.
- Decrease in local demand for gold: Apart from this, a big festival like Diwali has passed. Shopping for the wedding season is almost over. The lack of demand for gold locally is also considered a major factor in gold prices. According to experts, sellers are looking for demand for gold. But at the local level no trigger of this type is seen at the moment, so the demand for gold may increase. Secondly, old gold reaches local merchants. In such a situation, gold stocks accumulate among traders.
The price can reach 73 to 75 thousand.
If experts are to be believed, there may be a big drop in gold prices from India to the United States. While talking to TV9 Bharatvarsh Digital, Ajay Kedia, Director, Kedia Advisory, said that by the end of the year, gold prices may fall by 3-5 per cent. He said this means the price of gold can reach Rs 75,000 or less. Regarding gold prices in foreign markets, he said that on Comex gold can be quoted at $2,600 or less. He said that the effect of the strengthening of the dollar will be more visible in the coming days. Furthermore, the technical profit booking phase could continue in the coming days.
Big drop in gold price
On Wednesday, there was a sharp drop in the price of gold in the country’s Multi Commodity Exchange futures market. After the market closed, the price of gold fell by Rs 1,852 to Rs 76,655 per ten gram. While during the trading session, a drop of Rs 2,140 was observed in the price of gold. Gold price reached Rs 76,367 during the trading session. However, a day ago the price of gold was at Rs 78,507. On the other hand, silver prices fell by Rs 3,828 and closed at Rs 90,820. While during the trading session, the price of silver fell by Rs 4,628 per kg and reached Rs 90,020 per kg. While a day earlier the price of silver was Rs 94,648 per kg.
Gold and silver also plummet in foreign markets
On the other hand, a large drop in gold and silver is also observed in foreign markets. On the Comex market in New York there is a drop of around 3 percent, that is, more than $81 per ounce in gold futures and the price has reached $2,668.70 per ounce. While the spot gold price saw a drop of more than 3 percent, that is, $85 per ounce, and the price reached $2,659.40 per ounce. In the British and European markets, gold prices are falling by 1.87 percent and 1.24 percent respectively.
If we talk about silver, the price of silver futures on Comex decreased by 4.55 percent and the price stood at $31.29 per ounce. At the same time, the spot silver price was also trading at $31.17 per ounce, down 4.57 percent. In British markets, silver is trading at 24.19 pounds per ounce, down 3.38 percent. While in the European market silver is trading at 29.05 euros per ounce with a drop of 2.80 percent.
