Gold rises up to 1% this week amid geopolitical concerns, strong US dollar

Gold prices rebounded nearly 1%, or ₹710 per 10 grams this week as the precious metal held near two-week high levels in global markets.

Silver, on the other hand, closed the week with a marginal decline of 1% after a sharp rise on Friday. Silver prices increased ₹2,100 per kilogram on January 3 amid strong global cues and buying at lower levels.

Domestic prices

Gold started the week lower following a more than 1% retreat in the previous week due to a firm US dollar and a hawkish stance by the US Federal Reserve.

The 24K gold prices recovered some ground and traded above ₹78,000 per 10 grams on New Year’s Eve, drawing strength from global markets while local demand remained subdued.

Gold prices picked up pace to trade above ₹78,300 per 10 grams after the New Year’s holiday as the precious metal traded at near three-week highs in global spot markets.

The 22K gold traded at ₹72,150 per 10 grams, up by ₹650 in the last six days since December 30.

Silver prices, however, changed a little due to bouts of buying and selling this week. Silver declined for three straight days to New Year’s Eve due to poor offtake by industrial users and the metal’s losses in global markets.

The white metal fell to a two-week low on Thursday as the metal retreated in global markets. However, the metal attracted buying at lower levels and recovered losses on Friday to trade above ₹92,500 per kg.

Silver traded at ₹91,500 per kg on Saturday, declining by ₹1,000 this week.

International prices

Gold prices retreated from three-week highs on Friday to settle marginally up at $2,639 an ounce due to firm US bond yields and a stronger dollar. The metal touched a high of $2,660 an ounce in early trade on Friday but hawkish comments by Fed officials and better jobs data dragged gold lower.

Key triggers

A firm US dollar and rising bond yields have weighed on gold this week. The US currency has gained amid uncertainty around the trade policy of the upcoming Trump administration which will take over on January 20.

Geopolitical worries on the other hand provided some push to gold bulls and triggered buying despite thin trading in the holiday period.