Gold prices fell on November 22, 2023, as stronger-than-expected US jobs data influenced global markets, reducing the likelihood of a near-term interest rate cut by the US Federal Reserve. This unexpected dip in gold prices reflects the interconnectedness of global economic indicators and their impact on local markets, with city-level variations evident in gold rates across India.
The latest report on US nonfarm payrolls showed an increase that surpassed analyst expectations, prompting a reassessment of monetary policy forecasts. As a direct consequence, spot gold witnessed a decline, influenced by international selling pressures. Silver prices also experienced a downturn in response to the same data.
In India, local traders managed to balance global trends with movements in the rupee and domestic demand. The most actively traded December gold contract on the Multi Commodity Exchange (MCX) rose by approximately Rs. 1,168, closing at Rs. 1,23,895 per 10 grams. Analysts indicated that the depreciation of the rupee played a crucial role in limiting potential losses for local gold prices.
Renisha Chainani, Head of Research at Augmont, highlighted the US payroll report as a significant catalyst for the day’s trading activity. Similarly, Jateen Trivedi from LKP Securities noted the sharp volatility in the market, attributing some gains in the MCX to the weaker rupee. He anticipates that gold prices will continue to fluctuate within a range of Rs. 1,20,000 to Rs. 1,24,000 per 10 grams in the near future.
City-Level Differences in Gold Prices
On November 22, noticeable differences emerged in gold prices across major Indian cities. In Delhi, 24K gold was priced at Rs. 1,26,100 per 10 grams, while 22K gold was available at Rs. 1,15,500. In Mumbai, the rates were Rs. 1,24,250 for 24K and Rs. 1,13,890 for 22K. Meanwhile, Bengaluru reported slightly higher figures with 24K gold priced at Rs. 1,25,840 and 22K at Rs. 1,15,350.
These variations reflect local demand and supply dynamics, alongside broader national trends. The fluctuations in city rates highlight the impact of regional markets on gold pricing, with potential for rapid changes driven by future macroeconomic data and currency movements.
As the week progresses, further data releases and currency shifts are expected to shape gold prices significantly. While 24K gold remains the standard for bullion trading, 22K gold continues to be the preferred choice for jewellery in many urban centres. The interplay of global economic indicators and local market conditions will be crucial in determining the trajectory of gold prices in the coming days.
