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Gold prices fell nearly 2% on a weekly basis as rising crude oil prices and growing expectations of a US Federal Reserve rate hike weighed on investor sentiment.
On Friday, MCX gold futures for October declined 0.08%, while September silver futures fell 0.04%. MCX gold stood at ₹1,52,655, while silver traded at ₹2,34,886 per kg.
According to the India Bullion and Jewellers Association (IBJA), 24-carat gold was priced at ₹1,51,938 per 10 grams on Friday, down from ₹1,54,884 a week earlier.
Rising crude oil prices added to inflation concerns and increased expectations of tighter US monetary policy.
WTI crude climbed above $104 a barrel, gaining 9.6% over five sessions and nearly 16% in a month amid escalating US-Iran tensions and attacks on shipping routes.
Higher energy prices strengthened inflation concerns, putting additional pressure on precious metals.
Gold and silver recorded their third consecutive weekly declines, although both recovered on Friday.
US consumer inflation rose 0.4% month-on-month and 3.4% year-on-year in August, with energy prices contributing significantly to the increase.
US diesel prices crossed $6 a gallon, highlighting the inflationary impact of higher energy costs.
Producer-price data added to concerns, with annual producer inflation accelerating to 5.4%, above the 5.3% forecast.
Markets subsequently raised expectations of a Federal Reserve rate hike at the September 15-16 FOMC meeting to above 70%.
US Treasury yields climbed, with the 10-year yield touching 4.975%, its highest level since October 2023.
The two-year yield rose close to 4.65%, further reducing the appeal of non-yielding assets such as gold.
Analysts placed immediate resistance for Comex Gold at $4,500-$4,530, with support at $4,340-$4,370.
For MCX Gold, resistance stands at ₹1,54,000-₹1,54,700, while support lies at ₹1,50,000-₹1,50,700.
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