Gold prices steadied on Thursday after paring earlier gains, with spot gold trading at $4,244.29 per ounce by mid-afternoon, according to livemint.com. The metal had reached its highest level since June 18 earlier in the session. The price movement followed a rise in oil prices triggered by reports that Iran is reviewing a bill to bar 'hostile' vessels from the Strait of Hormuz, raising concerns about inflation and potential interest rate hikes.
The price fluctuations occurred amid geopolitical tensions in the Middle East, where Iran's proposal to restrict certain vessels in a critical oil shipping lane heightened market uncertainty. This development pushed oil prices higher, which in turn influenced gold prices due to gold's role as an inflation hedge. The US non-farm payrolls report scheduled for Friday added to market anticipation, impacting investor sentiment toward precious metals and the US dollar, which also showed strength during the trading session.
Gold's price behavior reflects its sensitivity to geopolitical and economic factors, especially in relation to oil markets and US economic data. The recent volatility in gold and silver prices, including a retreat from intraday gains, highlights the interplay between profit booking, currency strength, and easing tensions in the Middle East. The near-month MCX gold futures contract in India briefly crossed the ₹1.50 lakh per 10 grams mark before easing back to ₹1,48,500, indicating local market responsiveness to global cues.
On the domestic front, the MCX gold futures contract's brief surge above ₹1.50 lakh per 10 grams marked a notable event, the first since June 18, underscoring the impact of international developments on Indian precious metals trading. The US non-farm payrolls report release at 08:30 a.m. ET on Friday remains a key data point for market participants monitoring gold and silver price trends.