Gold, silver prices swing on MCX as oil, dollar, Fed jostle

Gold and silver prices on the Multi Commodity Exchange (MCX) saw sharp swings over two trading sessions. On Monday, August 17, Livemint reported gold and silver rose by up to 1% in early deals, with MCX gold October futures at Rs 1,55,079 per 10 grams, as the US dollar weakened and expectations of a US Federal Reserve rate hike in September faded. However, gains were capped by stalled US-Iran talks and uncertainty over the Strait of Hormuz, which kept oil prices elevated.

By Tuesday, August 18, the trend reversed. Livemint reported gold and silver dropped by up to 1%, with MCX gold October futures at Rs 1,55,090 per 10 grams, as profit-booking set in amid rising crude oil prices above $91 per barrel. Analysts cited fears that persistent inflation could push the Fed to hike rates. US President Donald Trump reiterated that the Strait of Hormuz is 'US territory,' while Iran said the strait remains under its command.

Markets now see roughly a 33% chance of a Fed rate hike in September, Livemint reported, citing analysts. Investors await the Fed's July meeting minutes on Wednesday and the July Personal Consumption Expenditures (PCE) price index on August 26. Manoj Kumar Jain of Prithvifinmart Commodity Research suggested buying gold above Rs 1,56,000 with a stop-loss below Rs 1,54,800 for targets of Rs 1,56,850 and Rs 1,57,400.