Gold and silver prices in India experienced a significant increase on the Multi Commodity Exchange on Friday, driven by robust buying activity. This surge is attributed to investor optimism surrounding a potential US-Iran peace agreement that may bring an end to the ongoing conflict in West Asia. MCX gold rate for August futures contracts commenced at Rs 1,50,595 per 10 grams, reflecting an increase of Rs 1,663, or 1.11%, compared to the previous close of Rs 1,48,932. MCX silver price for July futures contracts opened higher by Rs 3,123, or 1.30%, at Rs 2,42,776 per kg, compared to its previous close of Rs 2,39,653 level. In the international market, gold prices experienced a decline and were poised for a weekly loss, influenced by apprehensions regarding inflation and the possibility of interest rate increases by the US Federal Reserve. Spot gold price decreased by 0.5% to $4,191.17 per ounce, indicating a projected weekly loss of 3.2%. US gold futures for August delivery increased by 2.4%, reaching $4,212.70. Spot silver prices declined by 0.4%, settling at $67.10 per ounce.

On Thursday, gold prices declined to a level not seen in over six months before ultimately closing higher at $4,219.69, following US President Donald Trump’s decision to cancel planned military strikes on Iran and indicate a forthcoming peace agreement. Trump stated that the US and Iran might finalise a peace deal as early as this weekend, which would facilitate the reopening of the Strait of Hormuz for shipping. However, Iran responded by indicating that it had not yet made a definitive decision regarding the agreement. Gold prices have declined approximately 20% since the onset of the Iran war, driven by concerns over escalating inflation linked to high energy costs. This situation has heightened expectations for a rate hike by the US Federal Reserve, thereby increasing the opportunity cost associated with holding the non-yielding metal. Market participants are presently assigning a probability of 60% to the likelihood of a rate increase by the Federal Reserve in December, as indicated by the CME Group’s FedWatch tool. In terms of economic indicators, US producer prices experienced a greater-than-anticipated rise in May, resulting in the most significant annual increase observed in three and a half years. Meanwhile, holdings of the largest gold-backed exchange-traded fund, New York’s SPDR Gold Trust, decreased by approximately 0.3% to 923.89 metric tonnes on Wednesday.

Jigar Trivedi indicated that the outlook for MCX gold and MCX silver prices is favourable, anticipating a pullback movement. MCX gold rate is likely to encounter resistance at the Rs 1,52,000 level, with support anticipated at the Rs 1,49,500 level. “Traders can buy gold August futures as a pullback rally is expected,” stated Trivedi. Ponmudi R. It has been observed that the MCX gold price has surpassed the significant Rs 1,50,000 psychological threshold, indicating an enhancement in momentum within the price dynamics amidst ongoing volatility. A sustained move above Rs 1,52,000 is required to strengthen sentiment and extend the recovery toward the Rs 1,55,000 – Rs 1,56,000 zone. On the downside, a decisive break below the Rs 1,50,000 – Rs 1,49,000 support region could intensify selling pressure and drag prices back toward the Rs 1,47,000 – Rs 1,45,000 zone, according to Ponmudi R. Overall, he maintains that the near-term bias is cautiously optimistic, with prices finding stability above a significant psychological threshold. However, a sustained move above Rs 1,55,000 is necessary to validate strengthening momentum and bolster the recovery structure, as geopolitical uncertainties and broader market volatility persist in shaping price direction.

Support for MCX silver July futures is observed at the Rs 2,35,000 level, while resistance is positioned at the Rs 2,55,000 level, as noted by Trivedi. Ponmudi R stated that a sustained move above the Rs 2,48,000 – Rs 2,51,000 resistance zone is necessary for MCX silver price to strengthen momentum and initiate a recovery toward the Rs 2,58,000 – Rs 2,62,000 range. “On the downside, a decisive break below the Rs 2,40,000 support level could intensify selling pressure and drag prices back toward the Rs 2,34,000 – Rs 2,30,000 region. Overall, the near-term bias remains cautious to mildly positive, with prices attempting to stabilise and sustain above a key support level.”