Gold and silver moved in opposite directions on the Multi Commodity Exchange (MCX) on Friday, with the yellow metal losing Rs 800 per 10 grams while silver added Rs 1,000 per kilogram. The divergent moves came as a subdued US dollar and falling crude oil prices offered some support, though uncertainty over the direction of global interest rates kept traders cautious.
MCX gold and silver diverge
On the MCX, gold for delivery in October was quoted near Rs 1.52 lakh per 10 grams, down Rs 800 from the previous close. Silver, meanwhile, gained Rs 1,000 per kg, reflecting a split in sentiment between the two precious metals. The moves occurred against a backdrop of mixed signals from international markets, where spot gold in dollar terms also struggled to find a clear direction.
The MCX prices are influenced by the rupee-dollar exchange rate and domestic demand, but the primary driver remains the international spot price, which is quoted in US dollars per troy ounce. A weaker dollar makes gold cheaper for holders of other currencies, typically supporting prices.
Why oil and the dollar matter
Crude oil prices edged lower during the session, which can indirectly support gold. Lower oil prices reduce inflationary pressure and may temper expectations of aggressive interest rate hikes by central banks. Since gold pays no yield, it tends to benefit when the opportunity cost of holding it falls — for instance, when bond yields decline or when rate hike expectations ease.
The US dollar index, which measures the greenback against a basket of major currencies, was subdued. A softer dollar typically boosts gold and silver prices because it makes dollar-denominated commodities cheaper for overseas buyers. The combination of a weaker dollar and falling crude oil provided a supportive backdrop, even though gold on the MCX ended lower on the day.
Interest rate uncertainty lingers
Global financial markets remain focused on the outlook for interest rates, particularly from the US Federal Reserve. While the Fed has signalled a cautious approach, data-dependent decisions mean that any surprise in inflation or employment figures could shift expectations. This uncertainty has kept gold traders on edge, with many preferring to book profits on rallies rather than hold positions through potential volatility.
The mixed price action on the MCX reflects that cautious mood. Silver, which has both industrial and monetary uses, often shows stronger moves than gold during periods of shifting sentiment. Its gain of Rs 1,000 per kg suggests some buying interest, possibly from industrial users or speculative traders betting on a recovery in manufacturing activity.
Key takeaways
- Gold on the MCX fell Rs 800 per 10 grams, while silver rose Rs 1,000 per kg.
- A subdued US dollar and weaker crude oil prices offered support to precious metals.
- Uncertainty over global interest rates continues to drive cautious trading.
- Traders are advised to book profits on price rallies amid the uncertain outlook.
Common questions
Why did gold fall while silver rose?
Gold and silver do not always move in lockstep. Silver has a larger industrial component to its demand, so it can react differently to economic signals. On this day, silver benefited from a weaker dollar and lower oil prices, while gold faced profit-taking after recent gains.
What is the MCX?
The Multi Commodity Exchange (MCX) is India’s largest commodity derivatives exchange. It offers futures trading in gold, silver, crude oil, base metals, and agricultural commodities. Prices on the MCX are quoted in Indian rupees and reflect international benchmarks adjusted for local factors.
For the latest price, check the live gold price on GoldRate.info.
The mixed session on the MCX highlights how gold and silver remain sensitive to currency moves, oil price trends, and rate expectations. Until the interest rate outlook becomes clearer, traders are likely to continue taking profits on rallies rather than holding long positions through the uncertainty.