On MCX, gold futures for October skidded 0.51% to Rs 51,009 per 10 gram. Silver futures for September plunged 2.13% Rs 64,175 per kg. After the recent correction, gold prices
are down over Rs 5,000 from this months's high of Rs 56,200 while silver has tumbled about ₹13,825 from record highs of ₹78,000.
Spot gold prices
for 24 carat in Delhi continued to decline and fell by Rs 557 amid stronger rupee, HDFC Securities Senior Analyst (Commodities) Tapan Patel said.
In the international market, gold prices fell on Tuesday as growing optimism about U.S.-China trade relations boosted risk appetite as investors awaited a speech by Federal Reserve Chair Jerome Powell
Gold was quoting marginally higher at $1,930 per ounce, while silver was flat at $6.45 per ounce.
"Gold prices traded steady on weaker dollar and worries over rising virus cases in Asia and Europe. However, positive sentiments over signs of resumption in the US-China trade talks kept upside limited in the prices," Patel added.
Navneet Damani, VP Commodities Research, Motilal Oswal Financial Services said, "Gold prices had recouped some of the losses in yesterday's session although it failed to show strength and edged lower. Movement in dollar and hopes for coronavirus
treatment is responsible for the volatility in precious metal.
The benchmark S&P 500 opened at a record high on Tuesday as U.S. and Chinese officials reaffirmed their commitment to a Phase 1 trade deal, adding to optimism over progress in developing treatments for Covid-19.
On Sunday, U.S. President Donald Trump
hailed FDA authorization of a virus treatment that uses blood plasma from recovered patients.
Global central banks and governments have pumped in massive monetary and fiscal stimulus to prop up their virus-hit economies, which has helped bullion gain over 25% so far this year.
"The underlying fundamental pillars haven't wavered; we're still in the midst of the virus concerns, massive stimulus efforts that goes along with it. We can see short term pull back but we don't see that changing the big picture," Meger added.
Meanwhile, investors are awaiting Powell's speech at a gathering of central bankers in Jackson Hole, Wyoming, on Thursday, where he is expected to provide further clarity on the U.S. central bank's monetary policy stance.