Gold Prices Dip In Chennai Amid Global Headwinds And Tariff Concerns

While marginally higher rates were reported in Delhi and Lucknow, both regions also recorded a fall in prices compared to earlier levels.

Investors are also awaiting the release of the US Federal Reserve's FOMC meeting minutes, which could provide vital insight into future policy moves, especially regarding interest rates.

Source : PTI

Gold prices in Chennai witnessed a decline on Wednesday, in line with the broader weakness observed across major Indian cities. The rate for 22-karat gold stood at Rs 9,010 per gram, while 24-karat gold, also known as 999 purity, was quoted at Rs 9,829 per gram. This downward movement follows a consistent trend seen in key markets such as Kolkata, Mumbai, Bengaluru, and Pune.

While marginally higher rates were reported in Delhi and Lucknow, both regions also recorded a fall in prices compared to earlier levels. On Monday, the price for 22-karat gold in these cities was Rs 9,025 per gram, and 24-karat was at Rs 9,844 per gram. The price correction reflects cautious investor sentiment amid global uncertainties.

Markets Monitor Tariff Deadline and Fed Cues

The ongoing volatility in gold prices is being closely linked to the July 9 tariff deadline, which marks the end of a 90-day suspension on additional US duties targeting imports from several trading partners, including India. With a 26 per cent tariff potentially coming into effect, traders fear its impact could ripple across financial markets and influence demand for gold as a safe-haven asset.

"Going ahead, the focus will be on the interest rate cuts by key central banks, especially US Fed Reserve, the outcome of trade negotiation between US and its trading partners, incoming global economic data, which could impact the near-term gold prices," said Pranav Mer, Vice President, EBG, Commodity & Currency Research at JM Financial Services Ltd.

Investors are also awaiting the release of the US Federal Reserve's FOMC meeting minutes, which could provide vital insight into future policy moves, especially regarding interest rates.

Dollar Weakness and Central Bank Demand Support Gold Outlook

Despite recent softness, analysts suggest the broader picture for gold remains supportive, particularly due to consistent central bank purchases. In May alone, global central banks reportedly added a net 20 tonnes of gold to their reserves, underlining sustained institutional interest.

Prathamesh Mallya, DVP, Research, Non-Agri Commodities and Currencies at Angel One, pointed out, “Dollar weakness has been a key part of gold prices rising in 2024 as well as in 2025. This trend will continue for the rest of the year.”

However, strong economic data from the US continues to weigh on market expectations of a swift rate cut. “The short-term outlook favours consolidation and corrective upward movements, followed by a likely continuation of the broader downward trend,” noted N S Ramaswamy, Head of Commodities Desk and CRM at Ventura.

As Chennai mirrors the national pattern, market participants will remain watchful of upcoming economic indicators, policy developments, and global trade negotiations that could determine the trajectory of gold prices in the near term.