India gold futures fall Rs 3,000 as Fed rate hike bets surge
Escalating Middle East tensions have pushed oil prices up 12% this week, driving expectations of tighter US monetary policy and triggering a sharp selloff in Indian precious metals futures.
Gold futures for August 2026 delivery on the Multi Commodity Exchange of India (MCX) fell Rs 385 to Rs 1,40,733 per 10 grams on Thursday. The contract has now surrendered Rs 3,000 over the trading week. Silver futures for September 2026 dropped Rs 745 to Rs 2,15,268 per kg, accumulating a weekly decline of roughly Rs 7,000.
The simultaneous selloff in precious metals stems from a rapid repricing of global interest rate expectations. The catalyst is a surge in energy markets, where prices have climbed about 12% this week. This spike followed an escalation in military strikes between the United States and Iran on Thursday, a development that effectively dismantled a prior truce and triggered immediate concerns over potential crude supply disruptions.
Rising energy costs have resurrected fears of persistent inflation, shifting the tone at the US Federal Reserve. Dallas Fed President Lorie Logan became the first official under new Chairman Kevin Warsh to publicly call for a rate hike. Fed Vice Chair Philip Jefferson added to this hawkish pivot, indicating openness to raising rates if inflation fails to show meaningful improvement in the near term.
Because gold and silver do not yield interest, higher rate expectations directly erode their appeal to institutional capital. International gold prices have fallen more than 3% this week as a result. The broader metals complex mirrored this macro pressure, with spot silver, platinum and palladium all heading for weekly losses despite marginal daily price movements.
In the physical Indian market, 24-carat gold traded around Rs 1,14,624 to Rs 1,14,760 per eight grams across major cities including Mumbai, Delhi, Chennai and Hyderabad. For derivatives traders, Manoj Kumar Jain of Prithvi Finmart flagged immediate technical levels. He cited MCX gold support at Rs 1,39,600 to Rs 1,38,800, with resistance at Rs 1,41,100 to Rs 1,42,000.
Jain noted silver support at Rs 2,14,000 to Rs 2,11,100, and resistance at Rs 2,18,800 to Rs 2,21,000. His firm had recommended initiating long silver positions between Rs 2,17,000 and Rs 2,20,000 on Thursday, targeting Rs 2,24,000 to Rs 2,26,000. He stressed that investors holding those positions must strictly adhere to a stop loss below Rs 2,14,000.
