Gold rates fall ₹839 to ₹95,073/10 gm in futures trade as US dollar rises

Gold rates in the futures trade in India plunged by ₹839 to ₹95,073 per 10 gm on Friday, April 25, as the US dollar made a comeback amid a potential de-escalation of the trade war between the world’s superpowers, the US and China.

On the Multi Commodity Exchange (MCX), gold contracts for June delivery declined by ₹839, or 0.87% to ₹95,073/10 gm in a business turnover of 18,007 lots. Simply put, 18,007 gold futures contracts were traded on the MCX during the session.

The August contract of the precious metal dropped ₹760, or 0.79%, to ₹95,858 per 10 gm on the MCX.

Gold rates in spot markets in Mumbai declined by ₹655 to ₹95,631 per 10 gm (99.9 purity). The standard gold (99.5 purity) dropped by ₹652 to ₹95,248 per 10 grams. Bullion markets were closed in Delhi due to a bandh called by traders to protest against the Pahalgam terror attack.

Meanwhile, on the global front, gold futures declined by $40.26, or 1.2%, to $3,308.34 per ounce in New York. As per analysts, the fall in gold prices comes due to weak global cues. Gold prices have been soaring consistently this year, rising over 26% since January 1, 2025.

"Gold prices are under pressure as the US dollar strengthens on hopes of progress in US-China trade talks," Abans Financial Services' Chief Executive Officer Chintan Mehta said.

This development is easing safe-haven demand for gold as investors anticipate a potential thaw in tensions. If this trend persists, gold may remain on the back foot in the near term, he added.

The de-escalation of the trade war comes as China is now considering exempting some US imports from 125% tariffs imposed earlier as retaliation against the tariffs imposed by Trump. Notably, China has asked businesses to identify products that could qualify for the exemption. This is the strongest indication of the fact that Beijing is growing more and more anxious about the economic fallout of the trade war. The shift comes as China is looking to aid its domestic industry.

The escalating tensions between India and Pakistan are also resulting in a volatile environment as investors look for safer tools to hedge against volatility and geopolitical instability.

Mehta further said that attention will turn to the upcoming IMF meeting this weekend, where any indications of further policy easing or extended global uncertainty could enhance gold's appeal and reinforce safe-haven demand.

The future monetary policy decisions by the US Federal Reserve, especially the decisions on interest rate cuts, could have an impact on gold's trajectory, according to commodity experts.

As per a JP Morgan report dated April 22, 2025, gold prices hitting $4,000/oz is a possibility due to tariff-driven recession and stagnation risks. As per the report, gold prices could reach an average of $3,675/oz by the last quarter of 2025 and could hit above $4,000/oz by the second quarter of 2026.