Gold and silver prices fell sharply on Monday, August 31, as precious metals remained under pressure amid changing expectations around US interest rates, a stronger dollar and renewed geopolitical uncertainty.
In the Indian retail market, 24-carat gold was trading at around ₹1,54,940 per 10 grams in early trade, down 1.22%. Silver of 999 purity also declined 1.37% to around ₹2,38,870 per kg. The fall came after a sharp sell-off in global bullion markets last week.
On the Multi Commodity Exchange (MCX), gold futures were trading about 1.14% lower at ₹1,54,496 per 10 grams around 9:10 am. MCX silver futures were also under pressure, falling 1.28% to ₹2,39,341 per kg. Later market data showed gold and silver continuing to trade lower, reflecting the cautious mood among commodity investors.
The latest decline has come after gold prices suffered a steep fall in the previous session. International gold prices had dropped more than 3% as markets reacted to comments from US Federal Reserve Chair Kevin Warsh, which strengthened expectations that US interest rates could remain higher for longer.
Higher interest rates generally weigh on gold because the precious metal does not generate interest income. When bond yields rise, investors may find interest-bearing assets more attractive, reducing demand for bullion. A stronger US dollar can also make gold more expensive for buyers holding other currencies.
Geopolitical developments added another layer of uncertainty. Renewed military action involving the US and Iran prompted investors to reassess the outlook for global markets and commodities. While geopolitical tensions have traditionally supported gold as a safe-haven asset, concerns about inflation, crude oil prices and interest rates can produce a more complicated reaction in bullion markets.
International spot gold was around $4,455 an ounce on Monday after falling sharply in the previous session. US gold futures for December delivery were also lower, while spot silver was around $66.34 an ounce.
The fall was visible across major cities in India. In New Delhi, 24-carat gold was priced at ₹1,54,350 per 10 grams, while 22-carat gold stood at ₹1,41,488. The 999-fine silver rate was ₹2,38,180 per kg.
In Mumbai, 24-carat gold was available at ₹1,54,610 per 10 grams and 22-carat gold at ₹1,41,726. Silver was quoted at ₹2,38,590 per kg.
Bengaluru recorded a 24-carat gold rate of ₹1,54,680 per 10 grams and a 22-carat rate of ₹1,41,790. Silver stood at ₹2,39,110 per kg. In Kolkata, 24-carat gold was priced at ₹1,54,350 and 22-carat gold at ₹1,41,488 per 10 grams, while silver was at ₹2,38,610 per kg.
Hyderabad saw 24-carat gold at ₹1,54,800 per 10 grams and 22-carat gold at ₹1,41,900, with silver at ₹2,39,300 per kg. Chennai, according to the latest listed rate, had 24-carat gold at ₹1,55,010 and 22-carat gold at ₹1,42,093 per 10 grams, while silver was ₹2,39,620 per kg.
Rates offered by jewellery retailers can differ from benchmark bullion prices. The final amount paid by customers can also include GST, making charges and other applicable costs.
The India Bullion and Jewellers Association’s August 28 physical market report showed 999-purity gold at ₹1,58,386 per 10 grams and 916-purity gold at ₹1,45,082. Silver of 999 purity was quoted at ₹2,39,500 per kg. These rates were exclusive of GST.
The near-term outlook for gold and silver remains volatile. Investors are now likely to watch upcoming US economic data, particularly employment figures, for clues about the Federal Reserve’s next interest-rate decision. Any shift in expectations for a September rate move could have a direct impact on bullion prices.
Despite the recent correction, the longer-term outlook remains relatively supportive for precious metals. Central-bank gold purchases, geopolitical risks and demand for portfolio diversification continue to provide structural support for gold. Silver also has an additional demand driver through its industrial uses in electronics, renewable energy and emerging technologies.
This latest decline could offer some relief to those planning jewellery purchases, but prices remain highly sensitive to global developments. Buyers should therefore check the prevailing local gold rate, purity, making charges and GST before making a purchase.
The sharp movement in gold and silver prices also highlights how quickly the domestic bullion market can respond to changes in global interest-rate expectations, currency movements and geopolitical developments. Investors and jewellery buyers will be watching closely to see whether the current correction deepens or prices stabilise in the coming sessions.