Gold experienced a decline of 3.73%, closing at Rs 1,52,836, influenced by a robust U.S. dollar and positive labor market data that diminished expectations for imminent rate reductions by the Federal Reserve. In January, U.S. job growth exceeded expectations, and the unemployment rate decreased to 4.3%, bolstering the view that the Federal Reserve might maintain elevated interest rates for an extended period.

While markets continue to expect a minimum of two 25-basis-point reductions in 2026, expectations for immediate easing have been moderated. Conversely, the demand from China’s central bank continued to provide support. The People’s Bank of China has continued its purchasing trend for the 15th consecutive month, increasing its gold reserves to 74.19 million fine troy ounces as of the end of January. The value of its reserves increased significantly in response to rising prices. Retail dynamics exhibited a varied landscape across Asia.

In India, premiums have decreased by more than 50% from recent peaks, as volatility has dampened purchasing enthusiasm. In the interim, there has been an uptick in demand within China as the Lunar New Year approaches, resulting in a slight increase in local premiums. China’s full-year data indicated stable production growth alongside robust investment demand, especially in gold bars, coins, and ETFs, despite a decline in jewellery consumption.

The market is currently experiencing renewed selling pressure, as evidenced by an increase in open interest of 1.33%, reaching 7,914 lots. Immediate support is observed at Rs 1,48,935, with a breach potentially leading to a test of Rs 1,45,035. Resistance is positioned at Rs 1,57,740; a breakthrough above this level may pave the way towards Rs 1,62,645.