Gold to remain in corrective phase ahead of crucial US, China macro data

On the Multi Commodity Exchange (MCX), gold futures for December delivery slipped by ₹165, or 0.14%, during the past week, to settle at ₹1,21,067 per 10 grams on Friday

Gold prices are expected to remain in a corrective phase in the coming week ahead of the crucial US inflation data, continuing uncertainties over trade tariffs and key economic numbers from China, analysts said.

Traders will also closely watch comments from US Federal Reserve officials for clarity on the monetary policy outlook, which is likely to steer the near-term direction for bullion prices, they added.

"Gold prices are expected to see some consolidation or more correction as focus will be on the inflation numbers, US Supreme Court hearing on tariffs, speeches from Fed officials, and Chinese data," Pranav Mer, Vice President, EBG - Commodity & Currency Research, JM Financial Services Ltd, said.

He said that although gold prices ended the week slightly lower, the metal is largely stuck in a range, capped on the upside by a stronger dollar and sluggish physical demand as retail buyers stayed away on the sidelines in anticipation of further price correction.

However, Mer noted that the downside was capped by uncertainty over the US economic outlook as the federal government shutdown continues, delaying key macroeconomic data releases that could make Fed officials' task difficult when they meet next month.

"Traders were on the sidelines as focus also remained on the US Supreme Court's decision on the legality of Trump's trade tariffs - the outcome is expected to increase volatility in the financial markets and more in gold," Mer added.

On the Multi Commodity Exchange (MCX), gold futures for December delivery slipped by Rs 165, or 0.14 per cent, during the past week, to settle at Rs 1,21,067 per 10 grams on Friday.

"MCX gold futures are trading in the range Rs 1,17,000-1,22,000 per 10 grams in the same time frame. Weak US labour market report, safe-haven demand, hopes of potential interest rate cuts in the US and the central bank buying are factors driving gold prices in the near term," Prathamesh Mallya, DVP - Research, Non-Agri Commodities and Currencies, Angel One, said.

"Gold is on track for its annual gain since 1979, and if the current fundamental factors are in force, the volatility might drive a further rally in gold prices soon," he added.

In the international market, Comex gold futures for December delivery gained $ 13.3, or 0.33 per cent, during the past week, to settle at $ 4,009.8 per ounce on Friday.

"Gold hovered just near $ 4,000 an ounce this week, stabilising after sharp swings driven by shifting expectations over US monetary policy and labour market data. The metal briefly gained after reports showed US firms announced the highest October job cuts in over two decades, bolstering the case for a December rate cut," Riya Singh, Research Analyst, Commodities and Currency, Emkay Global Financial Services, said.

However, mixed signals from Federal Reserve officials and the absence of key inflation data due to the ongoing US government shutdown tempered optimism, she added.

After retreating 10 per cent from its record high above $ 4,390, gold is on course for a third straight weekly loss but remains up more than 50 per cent year-to-date -- its strongest performance since 1979.

Singh attributed the surge to rate cuts, persistent central bank purchases exceeding 600 tonnes so far in 2025, and steady inflows into gold-backed exchange-traded funds.

"However, bullion ETFs saw two consecutive weeks of outflows by the end of October as investors booked profits," she said.

Silver prices also remained range-bound during the week, mirroring the trend in gold and industrial metals.

On the MCX, the white metal futures for December delivery declined by Rs 559, or 0.38 per cent, to Rs 1,47,728 per kilogram on Friday. Comex silver futures edged lower last week and finished at $ 48.14 an ounce.

"Silver steadied above the $ 48 per ounce mark, supported by safe-haven demand amid the US government shutdown concerns and shifting expectations over the Federal Reserve's policy path," Singh said.

Washington's move to add silver, along with copper and uranium, to its official list of critical minerals marked a significant policy shift. The inclusion raises the total number of critical minerals to 60, and could lead to new tariffs and trade restrictions under the administration's Section 232 probe.

"The US relies heavily on imported silver for industrial uses spanning electronics, solar panels, and medical devices. Any tariff action could disrupt global supply chains and add to price volatility," Singh said.

Mer added that silver's price momentum appears consolidative to corrective as long as it remains below Rs 1,50,000-1,51,000 per kilogram, while key support is placed at Rs 1,39,300-1,38,000 per kg.

"While policy ambiguity and profit-taking could cap sharp gains, resilient industrial demand, geopolitical risks, and a weak US dollar are likely to keep silver prices well-supported above $ 47.55 per ounce in the coming sessions," Singh said.