Gold, silver rise on MCX as weaker dollar offsets Fed rate hike fears
Synopsis
Gold and silver found buyers on MCX on 20 July as the US dollar softened, but the rally is on a short leash — crude oil above $90 per barrel is stoking inflation fears and keeping Fed rate hike expectations alive, creating a classic tug-of-war that has defined precious metal trading for months.
Key Takeaways
MCX gold hit an intraday high of ₹1,41,649 per 10 grams on 20 July , up 0.52% at its peak.
MCX silver surged to an intraday high of ₹2,20,408 per kg , gaining as much as 1.85% .
COMEX gold slipped 0.24% to $4,009.30 per ounce ; COMEX silver gained 0.88% to $56.82 per ounce .
A softer US dollar drove value buying, while crude oil above $90 per barrel and Fed rate hike expectations capped gains.
Analysts see ₹1.42 lakh as the next key resistance for gold and ₹2.20 lakh as a critical support for silver.
Gold and silver prices climbed on the Multi Commodity Exchange (MCX) on Monday, 20 July, supported by value buying as the US dollar eased slightly — even as elevated crude oil prices and expectations of another US Federal Reserve rate hike kept investor sentiment cautious.
MCX Gold Performance
Gold futures for August delivery surged as much as 0.52%, or ₹743, to touch an intraday high of ₹1,41,649 per 10 grams at 11:45 am IST. The yellow metal subsequently pared some gains, trading at ₹1,41,254 — up ₹348 or 0.25% — after dipping to an intraday low of ₹1,41,081 during the session.
MCX Silver Performance
Silver futures for September delivery outpaced gold, climbing as much as 1.85%, or ₹4,005, to an intraday high of ₹2,20,408 per kg. The white metal was later trading at ₹2,18,225, up ₹1,822 or 0.84%, after touching an intraday low of ₹2,17,804.
International Markets: A Mixed Picture
Precious metals traded mixed on the global stage. COMEX gold slipped 0.24% to $4,009.30 per ounce, while COMEX silver gained 0.88% to $56.82 per ounce. The divergence between domestic and international gold prices reflects currency dynamics and local demand factors.
What Analysts Are Saying
Commodity market experts said the near-term outlook for both metals remains cautiously positive despite persistent global uncertainty. According to analysts, MCX gold is likely to stay supported above the ₹1.41 lakh level, with a sustained move beyond ₹1.42 lakh potentially reinforcing the recovery. Silver is expected to retain positive momentum if it holds above the ₹2.20 lakh mark.
Key Drivers: Dollar, Crude, and the Fed
Analysts noted that the softer US dollar provided the primary tailwind, making gold cheaper for holders of other currencies and boosting demand. However, the rally in crude oil prices above $90 per barrel — driven by escalating Middle East tensions — has reinforced inflation concerns. This, in turn, has strengthened expectations of yet another US Federal Reserve interest rate hike before year-end, capping the upside for bullion. Notably, this tug-of-war between a weaker dollar and hawkish Fed bets has defined precious metal trading for much of 2024, with gold repeatedly finding support near key technical levels even as rate pressure persists.
Point of View
Not a fundamental one. A marginal dip in the greenback is doing the heavy lifting, while the structural headwind — a Fed that has not yet signalled a pivot — remains firmly in place. Crude above $90 complicates the picture further: it feeds inflation, which keeps the Fed hawkish, which ultimately pressures gold. The divergence between a rising MCX gold and a falling COMEX gold on the same session is a reminder that currency effects can temporarily mask global price direction. Investors chasing the domestic rally without accounting for the Fed-crude dynamic may find the floor less solid than it appears.
NationPress
21 Jul 2026
Frequently Asked Questions
Why did gold and silver prices rise on MCX on 20 July?
Gold and silver rose on MCX on 20 July primarily because the US dollar eased slightly, making bullion cheaper for buyers holding other currencies and triggering value buying. However, gains were capped by elevated crude oil prices and expectations of another US Federal Reserve rate hike.
What were the MCX gold and silver prices on 20 July?
MCX gold for August delivery hit an intraday high of ₹1,41,649 per 10 grams and was later trading at ₹1,41,254, up 0.25%. MCX silver for September delivery touched ₹2,20,408 per kg at its peak and was trading at ₹2,18,225, up 0.84%.
How did international gold and silver prices move on the same day?
International markets were mixed — COMEX gold slipped 0.24% to $4,009.30 per ounce, while COMEX silver gained 0.88% to $56.82 per ounce. The divergence from domestic MCX trends reflects currency and local demand dynamics.
What are the key technical levels analysts are watching for gold and silver?
Analysts say MCX gold needs to hold above ₹1.41 lakh for support, with a move beyond ₹1.42 lakh needed to confirm a stronger recovery. For silver, ₹2.20 lakh is the critical support level to sustain positive momentum.
How does the Federal Reserve rate hike outlook affect gold prices?
Expectations of another US Federal Reserve rate hike tend to strengthen the dollar and raise the opportunity cost of holding non-yielding assets like gold, putting downward pressure on prices. On 20 July, this headwind was temporarily offset by a softer dollar, but analysts caution the Fed outlook remains a key risk for bullion.
