The Indian rupee opened 12 paise stronger at 85.44 against the US dollar on Monday, reflecting global economic shifts and market reactions. On Friday, the rupee had closed at 85.52 to the dollar.

Gold rises nearly 1 percent on domestic futures market

Gold prices saw an increase of nearly 1 percent in Monday's morning session on the domestic futures market, supported by a weaker dollar and renewed concerns about potential reimplementation of Donald Trump-era trade tariffs.

The MCX Gold June 5 contract was trading 0.95 percent higher at Rs 93,317 per 10 grams in early trade. Simultaneously, the US dollar index declined by approximately 0.3 percent, which supported the rally in gold. A weaker dollar makes gold more affordable for holders of other currencies, thus boosting demand.

Expert analysis and price levels

Rahul Kalantri, Vice President (Commodities) at Mehta Equities, said gold has support at $3,195–3,175 and resistance at $3,245–3,260, while silver is supported at $32.10–31.80 and faces resistance at $32.65–32.85.

“Gold prices climbed above $3,220 per ounce on Monday, rebounding from last week’s steepest decline in six months. The recovery was fuelled by renewed safe-haven demand after Moody’s downgraded the US sovereign credit rating, citing fiscal imbalances and rising debt costs,” he noted.

Market sentiment and outlook

Despite temporary optimism following a US–China tariff truce, weak US economic indicators and subdued inflation have pushed markets to anticipate further interest rate cuts by the Federal Reserve—providing additional support to gold.

“In INR terms, gold has support at Rs 91,850–91,480 and resistance at Rs 92,850–93,490, while silver is supported at Rs 94,480–94,850 per kg, with resistance at Rs 95,950–96,650,” Kalantri added.

Domestic demand ahead of wedding season

Gold prices have remained rangebound over the past two sessions, with few major triggers as the US-China trade truce and easing India–Pakistan tensions kept major fluctuations in check.

However, Aksha Kamboj, Vice President of the India Bullion and Jewellers Association (IBJA), stated that domestic demand ahead of the upcoming wedding season in India would cap the downside and ensure prices stay at elevated levels.

Courtesy: Mathrubhumi