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The global precious metal market saw a shift in fortunes on Wednesday, with gold prices experiencing a decline in India while silver prices saw a rebound. This dynamic is primarily influenced by global trends and the release of US economic data, particularly the anticipated US Consumer Price Index (CPI) report, which is expected to offer some short-term support for gold, according to Jateen Trivedi, VP Research Analyst - Commodity and Currency at LKP Securities. Trivedi noted that a downward trend in the CPI towards the Federal Reserve's 2 per cent target could potentially support gold in the long term.
The report highlights the potential impact of the US election on the precious metal market, with investors closely monitoring the implications of Trump's victory and the stances adopted by key cabinet appointments regarding China. This uncertainty, coupled with the recent global gold ETF outflows of around USD 809 million in the first week of November, after a six-month streak of inflows, suggests concerns over potential US-China trade tensions, according to the World Gold Council. This trend, however, is somewhat counterbalanced by strong demand from Asia.
Despite the decline in gold prices, the article emphasizes that global gold futures experienced a slight rise, while silver traded higher in the Asian market. The fluctuation in prices is further attributed to a stronger US dollar and higher treasury yields, as investors await the release of US macroeconomic data and remarks from Federal Reserve Chair Jerome Powell and other central bank officials. This volatile market landscape underscores the importance of monitoring global trends, US economic indicators, and the influence of political developments on precious metal prices.
The article concludes by emphasizing the interconnectedness of global markets, highlighting how international events and economic data significantly impact the prices of commodities like gold and silver. The article also underscores the importance of analyzing the various factors contributing to these price fluctuations, including global trends, US economic data, political developments, and investor sentiment.
Source: Gold Price Drops, Silver Rises: Latest Market Updates