News

Gold price today: Gold rates declined sharply in morning trade on the MCX on Monday, February 2, as investors and traders continued booking profits, tracking weak global cues amid increases in CME precious metals margin requirements.

MCX gold February futures fell by over 8,500, or 6%, to drop to ₹1,33,687 per 10 grams, while MCX silver March futures crashed by nearly ₹40,000, or 15%, to ₹2,25,805 per kg.

International gold prices also declined, with the US gold futures April contract falling to $4,605.49 per troy ounce, as increases in margin requirements for precious metals on CME set to take effect.

CME Group is one of the world’s largest derivatives marketplaces, which also owns CBOT, NYMEX, and COMEX.

According to an exchange statement, margin requirements for gold futures will be raised across risk categories. For non-heightened risk positions, margins will increase to 8% of the contract value from 6%. For heightened risk positions, margins will rise to 8.8% from 6.6%.

For silver futures, margins for non-heightened risk positions will be increased to 15% from 11%, while margins for heightened risk positions will go up to 16.5% from 12.1%.

An increase in margin requirements will mean traders will have to pay more in the derivatives segment. According to experts, this can dampen speculative trade and reduce liquidity.

Moreover, the market is also reacting to US President Donald Trump's Fed chair nominee Kevin Warsh.

According to Jigar Trivedi, Senior Research Analyst at IndusInd Securities, Friday’s rout was sparked by reports that Trump plans to nominate Kevin Warsh, viewed as a more hawkish choice, to lead the Federal Reserve.

Trivedi believes MCX gold February futures may decline further to ₹1,39,000 per 10 grams, as the trend is weak in the international market as well.

"Gold and silver prices fell sharply after Trump selected Kevin Warsh as the next Fed Chairman. Investors reacted negatively because Warsh is considered more aggressive on interest-rate policy than earlier leaders," said Rahul Kalantri, VP- Commodities, Mehta Equities.

"The decline was further supported by a stronger U.S. dollar, higher Treasury yields, and upbeat U.S. inflation data (PPI and core PPI)," Kalantri said.

According to Kalantri, gold has support at $4,655 and $4,575, while resistance is at $4,840 and $4,950. Silver has support at $74.8 and $69.75, while resistance is at $88.15 and $93.80.

In INR, Kalantri said gold has support at ₹1,39,650 and ₹1,36,310 while resistance is at ₹1,48,850 and ₹1,50,950. Silver has support at ₹2,48,810 and ₹2,37,170, while resistance is at ₹2,78,810 and ₹2,95,470.

Read all market-related news here

stories by Nishant Kumar

Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.

Catch all the Business News , Market News , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.

Download the Mint app and read premium stories

Log in to our website to save your bookmarks. It'll just take a moment.

Oops! Looks like you have exceeded the limit to bookmark the image. Remove some to bookmark this image.