Gold, Silver Prices Fall Sharply As Inflation Concerns Rise

Gold and silver prices witnessed sharp declines on Wednesday as investors grew concerned over rising US inflation and the possibility of higher interest rates.

Weak global sentiment and escalating geopolitical tensions in West Asia also added pressure on precious metals markets.

On the Multi Commodity Exchange (MCX), gold futures for June delivery fell by more than 1 per cent during intraday trade before recovering slightly.

Silver futures for July delivery also declined sharply amid continued selling pressure.

In the international market, COMEX gold and silver traded lower as investors reassessed expectations regarding future US Federal Reserve policy decisions.

Analysts said rising inflationary pressures have reduced hopes of interest rate cuts and increased speculation that the US central bank may maintain higher borrowing costs for a longer period.

Commodity experts said geopolitical tensions continued to pressure investor sentiment after US President Donald Trump warned that Washington could resume strikes on Iran within two or three days if Tehran rejected US peace terms.

The conflict disrupted shipping through the Strait of Hormuz, pushing crude oil prices higher and increasing global inflation concerns.

Analysts said rising oil prices could raise input costs and reduce the chances of major interest rate cuts by central banks.

Silver prices also weakened as investors booked profits after recent gains driven by optimism around AI and data-centre demand.

Sensex and Nifty opened lower amid weak global cues. Investors are now closely tracking Middle East developments, crude oil prices and signals from the US Federal Reserve.

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