Gold and silver prices declined by up to 2 per cent on the Multi Commodity Exchange (MCX) on Thursday, 11 June, as easing safe-haven demand and expectations of prolonged high US interest rates weighed on bullion markets amid the ongoing West Asia conflict. The selloff tracked a broader retreat in international precious metals prices.

MCX Price Movements

On the MCX, gold futures (August contract) fell as much as 1 per cent, declining ₹1,573 to an intraday low of ₹1,46,444 around 12 pm IST. By midday, the yellow metal was trading at ₹1,47,860, down ₹157 or 0.11 per cent, after touching an intraday high of ₹1,48,089.

Silver futures (July contract) were trading at ₹2,34,500, down ₹1,005 or 0.43 per cent. The white metal hit an intraday low of ₹2,30,493, a decline of 2.12 per cent, before recovering partially. Both metals had opened at ₹1,46,518 (gold) and ₹2,31,671 (silver) on the MCX earlier in the session.

Global Markets Under Pressure

International benchmarks mirrored the domestic weakness. COMEX gold was trading 0.68 per cent lower at $4,105.30 per ounce, while COMEX silver slipped 1.29 per cent to $63.90. Notably, gold has stabilised near multi-month lows after the US military confirmed the completion of its latest strikes on Iran, raising expectations that diplomatic negotiations could resume — a development that reduced the urgency of safe-haven buying.

What Is Driving the Decline

According to commodity analysts, the primary drag on bullion is the recalibration of safe-haven demand. With the most acute phase of the West Asia conflict appearing to pause, investors are reassessing the risk premium built into gold and silver prices over recent weeks.

Analysts also pointed to expectations that US interest rates could remain higher for longer, which reduces the appeal of non-yielding assets such as gold and silver. Market participants are additionally monitoring inflationary pressures from rising energy prices and their potential impact on the US Federal Reserve's policy trajectory.

Crude Oil Surges in Contrast

In a sharp contrast to bullion, crude oil prices surged on the same session. Brent crude rose over 2 per cent to trade near $95 per barrel, while US West Texas Intermediate (WTI) crude climbed 4 per cent to $93.64 per barrel. The divergence underscores how energy markets are pricing in supply disruption risk from the conflict, even as gold — typically the primary geopolitical hedge — pulls back on reduced immediate threat perception.

With diplomatic signals emerging from the West Asia theatre and the Fed's rate path still uncertain, bullion's next directional move will likely hinge on whether geopolitical risk re-escalates or rate-cut expectations firm up.