Gold price prediction: Gold rate suffers weekly losses, silver price faces correction. Here's what to expect

Gold price is heading for weekly decline even as spot gold jumped 0.5 per cent to $3,894.52 per ounce on Friday. While US gold futures for December delivery was up 0.4 per cent at $3,898.70 per ounce, gold rate fell 4 per cent so far this week. Spot silver was steady at $50.05 per ounce, platinum fell 0.31 per cent to $1,513.92 while palladium climbed 2 per cent to $1,013.13. All three metals were also on course to post losses for the week.

Gold price has slipped below the USD psychological level of USD 4,000 mark.

Gold hovered around USD 3,900 per ounce after touching a fresh 52-week low on Thursday. The selloff intensified after President Donald Trump's remarks that Washington did not need a peace agreement with Tehran dampened expectations of an immediate diplomatic breakthrough, Saumil Gandhi, Senior Analyst of Commodities at HDFC Securities told PTI.


Gold Rate Prediction

Gold was moving higher after a big slip on Thursday, as prices had been pushed into oversold territory. The metal is undervalued currently, and gold prices have a good support level at around the $3,850 mark, said Nitesh Shah, commodity strategist at WisdomTree, Reuters reported.

Markets see an 88 per cent chance of a 25-basis-point US rate hike in December, while the probability of a larger 50-basis-point move is priced at 12 per cent, according to CME's FedWatch tool. Although gold is seen as an inflation hedge, higher interest rates tend to diminish its appeal as bullion pays no interest.

Federal Reserve Bank of New York President John Williams said on Thursday that more rate hikes are likely as the US central bank seeks to lower high levels of inflation in an otherwise healthy economy.

Gold prices plunged 3 per cent on Thursday, hitting a more-than-one-year low, as oil prices climbed on fading hopes for peace in the Middle East, spurring fears of higher inflation and elevated interest rates.

Silver Price

Silver is also facing a sharp correction, with rising US Treasury yields and a stronger dollar weighing on precious metals, Vikram Subburaj, CEO at Giottus.com told PTI.

The sharper decline in the metal highlighted its greater sensitivity to changes in risk appetite and industrial demand expectations, Subburaj said.