Gold prices in the souk market witnessed a sharp fall on June 13 after the US Federal Reserve decided to keep rates unchanged at a 23-year high. This will be the seventh consecutive policy where the Fed has opted for the status quo. The reason why prices of yellow metals fell globally is because the Fed was more hawkish and now expects only 1 rate cut scenario in 2024 from its previous expectations of 3 rate cuts.

Gold Prices In Dubai:

In the Indian rupee, 100 grams of 22K gold is at Rs 5,88,571, declining by Rs 5,118 from the previous day. While 10 grams of the same carat stood at Rs 58,857 down by Rs 512, 8 grams was below Rs 409 to Rs 47,086, and lastly, 1 gram of gold slipped by Rs 51 to Rs 5,886 on Thursday from the previous day.

Further, in the case of 24K, 100 grams of gold dipped by Rs 5,118 to Rs 6,35,770 on Thursday, 10 grams dived by Rs 512 to Rs 63,577, 8 grams fell by Rs 409 to Rs 50,862, and lastly, 1 gram down by Rs 51 to Rs 6,358.

In the case of the local currency in Dubai, 22K and 24K gold prices plunged by 2.25 dirhams to 225 dirhams. Further, 18K prices tumbled by 1.75 dirhams to 175 dirhams.

In dirhams, 22K of 100 grams is at 25,875 AED, 10 grams at 2,587.50 AED, 8 grams at 2,070 AED, and 1 gram at 258.75 AED.

Also, 24K of gold is at 27,950 AED, 10 grams at 2,795 AED, 8 grams at 279.50 AED, and 1 gram at 279.50 AED on Thursday.

While 18K of 100 grams is at 21,475 AED, 10 grams at 2,147.50 AED, 8 grams at 1,718 AED, and lastly, 1 gram at 214.75 AED.

So far, in June, gold prices are down by nearly 1% across carats.

Rahul Kalantri, VP of Commodities, Mehta Equities said that gold and silver gained on Wednesday after U.S. inflation eased in May. The U.S. CPI inflation came in at 3.3% year-over-year, slightly below the expected 3.4%. Core CPI inflation for May was 0.2%, also below the expected 0.3%. Following the easing inflation, the dollar index and bond yields slipped, supporting gold and silver prices. However, the U.S. Federal Reserve kept the interest rate unchanged within the range of 5.25% to 5.50%, with hawkish comments on rate cuts."

Kalantri further said, "The Fed signalled one rate cut this year due to elevated inflation and a healthy job market. Despite the supportive environment, hawkish comments on interest rate cuts by the U.S. Fed could potentially push gold and silver prices lower again."

Lastly, he said, "Gold has support at $2,294-$2,278 and resistance at $2,328-$2,342. Silver has support at $28.85-$28.65 and resistance at $29.28-$29.45. In INR terms, gold has support at ₹71,550-₹71,280 and resistance at ₹72,100-₹72,350. Silver has support at ₹89,100-₹88,350 and resistance at ₹90,530-₹91,150."

On June 12, FOMC gave hawkish outcomes despite US inflation data coming softer than expected. Fed kept key fund rates at a 23-year high of 5.25-5.5% for the seventh time in a row. Instead of earlier three rate cut expectations in 2024, the Fed now expects only 1 rate cut this year and hints at four rate cuts in 2025.

Additionally, India's CPI inflation came in at 4.75% in May 2024, easing for the fifth consecutive month and marking the lowest level in 1 year. Further, inflation is now lower than RBI's upper tolerance limit of 6% for the ninth month straight.