Gold and silver prices traded in a narrow, mixed range on the Multi Commodity Exchange (MCX) during Friday morning's session, 18 September. A decline in crude oil prices and a flat US dollar provided some support to the precious metals, but unresolved geopolitical worries linked to the US-Iran conflict kept investors from taking clear directional bets.
Market snapshot at 9:10 AM IST
MCX gold futures for October delivery edged lower by 0.08%, trading at ₹1,52,861 per 10 grams. In contrast, MCX silver December futures gained 0.49% to ₹2,39,380 per kilogram. On the international front, US gold futures for December delivery slipped 0.10% to $4,380.95 per troy ounce.
The international crude oil benchmark Brent crude declined by 1%, trading below $104 per barrel. The US dollar index remained flat on the day but was on course to end the week with a gain of more than 1%, a factor that typically weighs on dollar-denominated gold.
Central bank rate hikes continue to pressure gold
Gold is a non-yielding asset, meaning it tends to lose appeal when interest rates rise. In September, several major central banks tightened monetary policy. The US Federal Reserve raised its benchmark rate by 25 basis points on 16 September, following similar moves by the European Central Bank and the Bank of Japan — the latter lifted rates to a 31-year high of 1.25%. The Bank of England, however, kept its policy rate unchanged. The cumulative effect of higher rates elsewhere could keep gold under pressure, as it competes with yield-bearing assets.
US-Iran conflict adds uncertainty
Geopolitical uncertainty is often supportive for gold as a safe haven, but the specific nature of the US-Iran standoff introduces a complicating factor. According to a report by Axios, US President Donald Trump on Thursday indicated he faces a major decision on whether to escalate military action in Iran.