Gold Prices Slip on First Day of June; Rates Ease Across Major Cities as Investors Stay Cautious

Gold prices started June on a weaker note, with rates declining across several major Indian cities. The drop comes amid a stronger US dollar, rising crude oil prices, and uncertainty surrounding ongoing diplomatic developments between the United States and Iran.

Market participants remain cautious as global economic and geopolitical factors continue to influence investor sentiment. The recent weakness in bullion prices has also been reflected in domestic markets, where gold has extended the correction seen over the past week.

Gold Becomes Cheaper Across Key Indian Cities

On June 1, the price of 24-carat gold declined in major markets, bringing some relief to buyers after weeks of elevated rates.

In the national capital, Delhi, 24-carat gold was trading at ₹1,57,180 per 10 grams, while 22-carat gold stood at ₹1,44,090 per 10 grams.

Mumbai and Kolkata reported similar rates, with 24-carat gold priced at ₹1,57,030 per 10 grams and 22-carat gold available at ₹1,43,940 per 10 grams.

Chennai continued to record the highest prices among major cities, where 24-carat gold was quoted at ₹1,59,590 per 10 grams and 22-carat gold at ₹1,46,290 per 10 grams.

Over the past week, 24-carat gold prices have fallen by nearly ₹2,000 per 10 grams, while 22-carat gold has declined by around ₹1,850.

Gold Rates in Major Cities

What Is Putting Pressure on Gold Prices?

Analysts point to several global developments that have weighed on gold in recent sessions.

Stronger US Dollar

A stronger dollar typically makes gold more expensive for international buyers, reducing demand and putting downward pressure on prices.

Rising Crude Oil Prices

Brent crude oil prices have climbed above the $93-per-barrel mark after gaining more than 2%. Higher energy prices can influence inflation expectations and broader market sentiment, leading investors to reassess their positions in precious metals.

US-Iran Negotiations

Markets are closely monitoring diplomatic developments between Washington and Tehran. Uncertainty regarding a potential ceasefire agreement and broader geopolitical negotiations has created mixed signals for investors.

While geopolitical tensions usually support gold as a safe-haven asset, optimism around negotiations can reduce demand for defensive investments.

Global Gold Market Remains Volatile

In international markets, spot gold was trading near $4,527.36 per ounce.

Global investors are awaiting several important economic indicators and policy signals that could shape expectations regarding future interest rate decisions and economic growth.

Market experts believe that bullion prices may continue to witness short-term fluctuations until greater clarity emerges on inflation, geopolitical developments, and central bank actions.

Silver Prices Also Move Lower

Gold was not the only precious metal under pressure.

Silver prices also declined on the first trading day of the week.

In the domestic market, silver was trading at approximately ₹2,79,900 per kilogram. Over the past week, silver prices have corrected by nearly ₹5,000 per kilogram.

Internationally, spot silver was quoted near $75.54 per ounce.

Despite the recent weakness, silver remains significantly higher than levels seen in previous years. Earlier this year, domestic silver prices briefly crossed the ₹4 lakh per kilogram mark, highlighting the metal's sharp rally during recent months.

Factors Influencing Gold and Silver Prices

Precious metal prices are influenced by a combination of domestic and global factors, including:

• US dollar movements

• Crude oil prices

• Inflation trends

• Central bank policies

• Interest rate expectations

• Geopolitical tensions

• Global economic growth

• Investor demand for safe-haven assets

Any major developments in these areas could trigger fresh movement in bullion markets.

Outlook for the Week

Market analysts expect gold and silver prices to remain sensitive to economic data releases, global political developments, and central bank commentary throughout the week.

Investors will particularly focus on US employment data, global manufacturing indicators, and upcoming monetary policy decisions for clues about future market direction.

For now, the overall trend suggests cautious trading, with bullion markets likely to remain volatile as investors balance geopolitical risks against improving sentiment in other asset classes.