As of Monday, May 12, 2025, gold prices have experienced a significant decline, influenced by easing geopolitical tensions and positive developments in global trade relations.

Gold rates across major Indian cities have dropped notably:

Mumbai: 22K gold at ₹8,880/gm, 24K at ₹9,688/gm

Delhi: 22K at ₹8,895/gm, 24K at ₹9,703/gm

Chennai: 22K at ₹8,880/gm, 24K at ₹9,688/gm

Hyderabad: 22K at ₹8,880/gm, 24K at ₹9,688/gm

On the Multi Commodity Exchange (MCX), gold futures for June delivery fell by ₹2,424, reaching an intraday low of ₹94,094 per 10 grams .

Several international developments have contributed to the downturn in gold prices:

• US-China Trade Relations: Optimism surrounding a potential trade agreement between the U.S. and China has reduced the demand for gold as a safe-haven asset .
• India-Pakistan Ceasefire: The announcement of a ceasefire between India and Pakistan has further alleviated geopolitical tensions, impacting gold’s appeal .
• Strengthening U.S. Dollar: A robust U.S. dollar has made gold more expensive for holders of other currencies, thereby dampening demand .

Despite the current dip, some analysts maintain a bullish long-term perspective:

• Technical Analysis: Gold has rebounded from recent lows, with potential to challenge resistance levels at $3,500 and possibly reach targets of $3,581 and $3,794, indicating a bullish trend continuation .
• Expert Forecasts: Jeff Gundlach, CEO of DoubleLine Capital, anticipates gold prices could surge to $4,000 per ounce, citing market volatility and economic uncertainties as driving factors .

Short-Term: Given the recent price drop, investors might consider this an opportunity to enter the market at lower levels. However, caution is advised due to potential continued volatility influenced by global events.

Long-Term: For those with a longer investment horizon, the current dip could be a strategic entry point, aligning with forecasts predicting higher gold prices in the coming months.

Sources