Gold Price Falls 1% Today: MCX Gold Slips Below ₹1.50 Lakh, What Is Driving The Fall?
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MCX gold slipped below ₹1.50 lakh on October 5 after losing around 3% in September. While the sharp fall in Indian equities has brought safe-haven demand back into focus, interest rates, the dollar and geopolitical developments remain key for bullion.
Gold prices fell nearly 1% on Monday, October 5, with MCX December futures slipping below ₹1.50 lakh per 10 grams as the yellow metal remained under pressure amid moves in the US dollar and uncertainty over the global interest-rate outlook.
MCX gold was trading at ₹1,49,184 per 10 grams around 10 am, down ₹1,206, or 0.8%, from its previous close. The contract fell as much as 1.02% to an intraday low of ₹1,48,850 after opening at ₹1,51,197.
The latest fall comes after a weak September for bullion. MCX gold lost around 3% during the month, even as Indian equities saw a sharper correction, with the Nifty 50 falling 6.1% and the Sensex losing 5.8%.
Why Is Gold Price Falling Today?
Gold's fall below ₹1.50 lakh comes as traders continue to track the US dollar and the direction of interest rates.
Higher interest rates can weigh on gold because the metal does not offer interest. A stronger dollar can also make bullion more expensive for buyers using other currencies.
At the same time, geopolitical uncertainty remains in focus. US President Donald Trump said last week that Washington faced a choice between further military action against Iran and reaching an agreement with Tehran. Such uncertainty can support demand for gold, but so far it has not been enough to prevent the fall in domestic prices.
Gold is also coming off a weak month. MCX gold declined around 3% in September, while silver fell more than 5.4%.
Can Stock Market Volatility Support Gold Prices?
The fall in Indian equities has again put gold's role during periods of market stress in focus.
The Nifty 50 dropped 6.1% in September to 22,620.45, while the Sensex fell 5.8% to 72,480.29, marking the second consecutive monthly decline for both benchmarks.
Gold is generally used as a hedge during periods of inflation, geopolitical uncertainty and financial-market stress. However, weakness in equities does not necessarily mean gold prices will rise at the same time. High interest rates and a stronger dollar can continue to weigh on bullion even when stock markets are falling.
Gold Price Outlook: ₹1.48 Lakh Level In Focus
With MCX gold falling below ₹1.50 lakh, that mark has now become an important level to watch.
Market analysts see support at ₹1,48,000-₹1,47,300, followed by ₹1,46,000-₹1,45,300. On the upside, resistance is seen at ₹1,51,000-₹1,51,600 and then ₹1,52,500-₹1,53,000.
A sustained move back above ₹1.50 lakh could help gold stabilise. A break below ₹1.48 lakh, however, could put ₹1.46 lakh back in focus.
For now, movements in the dollar, interest-rate expectations and developments around the US-Iran situation remain the key factors to watch for gold.
This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
Rochelle Britto has spent 8+ years decoding India's markets, businesses, and consumer economy, reporting for ET Prime and Times Internet along the way, covering the stories behind the numbers.
A Mumbai native and perpetual planner of the next holiday, she stays far, far away from the eternal question, “Where are we going next?” When she's not chasing headlines, she's chasing new cultures, open roads, and a bit of quiet in nature.
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