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Gold prices are facing pressure due to a strong US dollar and rising yields, coupled with increasing inflation expectations. The surge in oil prices, driven by escalating Middle East tensions, is adding to the inflation concerns. The US President’s announcement of “Project Freedom” to reopen the Strait of Hormuz has intensified supply disruption fears, pushing crude prices higher .
The domestic gold market is also feeling the pinch, with rising USDINR capping losses for bullion. Despite heightened geopolitical risks, gold is struggling to gain traction as higher bond yields and a firm dollar weigh on non-yielding assets .
Experts suggest that markets are now focused on global PMI readings and upcoming US labor market data for further directional cues. Manav Modi, Commodities Analyst at Motilal Oswal Financial Services, notes that inflation concerns and a stronger US dollar are limiting gold’s upside .
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