Gold began the week on the back foot, falling Rs 500 to Rs 1,55,400 per 10 gram in the national capital on Monday as a sell-off in global markets gathered pace amid a sharp rise in crude oil prices and the US dollar.
The yellow metal of 99.9 per cent purity had closed at Rs 1,55,900 per 10 gram on Friday.
However, silver bucked the trend and held steady at Rs 2,34,600 per kilogram (inclusive of all taxes), according to local traders.
Globally, spot gold declined USD 57.22, or 1.3 per cent, to USD 4,291.71 per ounce and silver tumbled nearly 3 per cent to USD 62.82.
Gold slipped back to around USD 4,300 per ounce and silver eased to USD 64, marking their third consecutive weekly loss as investors priced in a probable Fed rate hike, Akshat Siddhant, Lead Quant Analyst at investment platform Mudrex, said.
Higher oil prices have added to inflation worries, putting further pressure on demand for gold and silver, he said.
Crude oil surged to USD 103 a barrel, a fresh four-month high, after Saudi Arabia shut its East-West pipeline following drone attacks, reversing the losses recorded on Friday, Siddhant added.
Meanwhile, the oil spike is also complicating the interest-rate outlook, with the Australia and New Zealand Banking Group (ANZ) forecasting three 25-basis-point Federal Reserve rate increases by March 2027.
ANZ expects geopolitical developments in West Asia and elevated energy costs to add to inflation, but said persistent geopolitical uncertainty could simultaneously strengthen gold's safe-haven appeal.
The bank retained its 12-month gold price target of USD 5,400 an ounce, pointing to recovering gold-backed ETF holdings and speculative positions, institutional demand in China and rising investor participation in India, as factors supporting investment demand for the metal.
