Gold price marginally high, but ₹11,000 down from August's record high
The yellow metal on Friday was trading slightly up by ₹39 or 0.09 per cent on Multi Commodity Exchange (MCX). The gold futures on Friday was up at ₹44,990 per 10 gram. Silver futures on MCX has slipped by ₹433 or 0.64 per cent at ₹67,314 per kg.
In the previous session, gold had closed at ₹44,951 per 10 gram while silver had closed at ₹67,747 per kg.
The precious metals have declined by more than ₹10,000 from their last year peaks. The bullion in August 2020 traded at ₹56,200 per 10 gram and silver peaked at ₹77,800 per kg.
In the international market, gold prices fell as the US dollar held on to the gains of the rising US Treasury yields. Spot gold declined 0.2 per cent at $1,733.74 per ounce after a two-week high of $1,755.25 on Thursday. US gold futures were also down 0.1 per cent at $1,731.50.
The US Treasury yields that are witnessing an almost one-year high increase the opportunity cost of holding the non-interest-bearing assets like the bullion, which was the safe-haven asset last year in the face of uncertainty.
An analyst told Reuters that the strong economic rebound, asserted by the US Federal Reserve forecast, in the presence of no inflation will be bad for gold.
"If the economy gets stronger and there's still no inflation, that is bad for gold," the analyst said. The bullion is often considered a hedge against inflation.
"Gold's upside looks limited by rising yields and buoyant risky assets... Talks around tapering asset purchases will be the key headwind later this year," Reuters quoted an ANZ analyst as saying.