Summary of this article
Gold and silver futures fall sharply on MCX
Strong US jobs data triggers massive metal selloffs
Rising interest rates make non-yielding bullion less attractive
Gold and Silver Futures dipped on the Multi Commodity Exchange on June 8. Gold Futures with August 5, 2026 expiry declined nearly 2 per cent to an intraday low of Rs 1,52,712 per 10 grams. On the other hand Silver Futures with July 3, 2026 expiry declined nearly 4 per cent to an intraday low of Rs 2,39,064 per 1 kg.
According to the India Bullion and Jewellers Association website, physical gold prices also fell 2.21 per cent to Rs 1,50,768 per 10 grams. On the other hand, physical silver prices slipped 5 per cent to Rs 2,41,160 per 1 kg.
In the global market, international spot gold prices tanked over 3 per cent, diving below the key psychological support level of USD 4,300 per troy ounce. This massive drop completely erased the metal's year-to-date gains after it had rallied close to the USD 5,600 level earlier in January.
Why Are Gold and Silver Prices Falling Today
Stronger-than-expected macroeconomic factors from the global arena are heavy drivers behind the steep sell-off in precious metals. Kaveri More, Commodity Technical Analyst at Choice Broking told Outlook Money that gold futures slipped on the MCX as the US released stronger than expected jobs data. This in turn allows the US Federal Reserve to keep interest rates higher and even increase them, which makes gold less lucrative to investors leading to selloffs.
“Gold futures on the MCX fell by nearly 2 per cent today, primarily triggered by stronger-than-expected U.S. jobs data that signaled the Federal Reserve may maintain a tighter monetary policy stance for longer and could even raise interest rates later this year,” More said
The data revealed that the US economy added 1,72,000 jobs in the month of May, the data pushed the U.S. 10-Year Treasury Yield to a 2-week high.
“The U.S. economy added 172,000 jobs in May, far surpassing forecasts of 85,000, while unemployment remained steady at 4.3 per cent. This robust data propelled the U.S. 10-Year Treasury Yield to a two-week high and pushed the dollar index back to the 100 level, making non-yielding gold less attractive to investors,” More added.
More added that despite a rise in geopolitical tensions between Israel and Iran, macroeconomic pressures kept gold prices subdued in today’s trade.
“While geopolitical tensions persist, Iran launched multiple missile rounds toward Israel, and President Donald Trump has urged both Israel and Iran to avoid retaliatory action and resume negotiations, these factors have not been enough to offset the dominance of macroeconomic pressures,” More said.
Other than US jobs data, energy market movements also created downward pressure on gold and silver prices. Brent Crude prices inched higher amid the West Asia conflict leading to greater worry around inflation. Interest rate anxiety seems to override safe-haven demand as institutional investors fear that energy-driven inflation will force the U.S. Federal Reserve and other global central banks to keep interest rates higher for much longer, or even consider another rate hike before December, making non-yielding assets less lucrative.
On the other hand the decline in silver prices outpaced gold on account of shifting economic indicators. Silver prices typically tend to be highly sensitive to broader manufacturing health Amid expectations of high global interest rates reducing liquidity and slowing down industrial expansion, industrial demand forecasts for silver have been adjusted downward.
On the domestic front, institutional and regulatory conditions are likely to have increased the price slide on the MCX. Amid the high volatility seen across global markets, exchange systems activated dynamic margin adjustments to protect market stability.
These margin requirements are likely to have led to highly leveraged retail traders and short-term speculators abruptly cutting down their positions which in turn added localised selling pressure, amplifying the downward momentum of gold and silver.
Outlook For Gold and Silver Prices
Near-term expectations indicate that bullion will remain under pressure, though geopolitical realities are expected to establish a baseline cushion. More added that silver and gold prices are expected to remain in a moderately bearish trend in the near-term.
“Following today's notable drop in silver futures, both gold and silver are expected to remain in a moderately bearish trend in the near term, though persistent geopolitical tensions in the Middle East will continue to provide a floor through safe-haven demand,” More said.
More added that presently silver is underperforming gold, subdued physical demand in India and declining Swiss exports indicate limited upside for gold.
“The Gold/Silver ratio, hovering strongly above 64:1, indicates that silver is underperforming relative to gold, reflecting weaker industrial demand expectations alongside monetary policy pressures. Although central banks resumed net gold purchases in April (17 tonnes), signalling sustained institutional appetite despite higher-for-longer interest rates, subdued physical demand in India and declining Swiss exports suggest limited upside momentum,” More said.
Kaynat Chainwala, Assistant Vice President, Commodity Research, Kotak Securities told Outlook Money that while gold and silver are expected to trade with a bearish trend in the near-term, investors should look out for factors such as the May Consumer Price Inflation (CPI) data.
“Both metals are expected to trade with a sideways-to-bearish bias in the near term. The May CPI print due June 11 is the pivotal near-term catalyst. A hot reading would cement Fed rate hike expectations under Chair Warsh, extend dollar strength, and reinforce the bearish bias for both metals,” Chainwala said.
