On MCX, gold futures (October 2019) were trading lower than its previous close hitting intraday high and low of Rs 37,947 and Rs 37,788 per 10 grams, respectively. The rates are over Rs 2,000 lower than the all-time high of Rs 39,885/10 grams seen last week.
Silver futures on MCX were trading around the price of Rs 47,500 per kilo which is over Rs 4,000 lower than its all-time high of Rs 51,489, also attained last week.
The price correction seen for the whole week are subject to certain factors that dictate the rates of these precious metals.
Improved trade relations
In the international market, spot gold fell 0.2 percent to $1,494.02 per ounce and US gold futures slipped 0.1 percent to $1,501.70 an ounce.
On Wednesday, the US agreed to delay its increase in tariffs on $250 billion Chinese goods to 15 October from 1 October as a goodwill gesture.
American president Donald Trump in a tweet said that the gesture was "at the request of the Vice Premier of China, Liu He, and due to the fact that the People's Republic of China will be celebrating their 70th Anniversary" on 1 October.
The two trade partners are scheduled to meet in October for their next round of trade negotiations. Chinese as well as American stock markets gained on the news.
The not so significant gesture did signal towards easing tensions between the two largest economies in the world. It lifts the risk sentiments among investors who withdrew their funds from safe haven assets like gold and silver, dragging their prices down.
Further, market watchers have moved their attention to the ECB (European Central Bank) and US Federal Reserve's monetary policy meetings, scheduled this week.
Investors now await their rate decision and measures that will be announced by these Central Banks to improve dampened economy, especially in the Europe, where Brexit concerns loom.
The rupee was seen trading higher for the sixth straight session on Thursday. It rose to its one-month high of 71.29 a dollar after opening at 71.43.
The Indian rupee's strength against the US dollar makes the metals cheaper as the country's consumption of gold is largely dependent on imports (which are made in US dollar terms). Silver generally imitates changes in gold's price.
In the previous week, when both gold and silver futures saw their new all-time highs, rupee had touched its low for the year at 72.40 against the dollar.
Emerging market currencies gained on a some relaxation in US-China trade spat.
The month of August saw prices of gold and silver spiking at record rates. For those who had bet money on the metals in the previously, saw the price rise last week as an opportunity for profit booking, now that the global economy showed signs of some improvement.
The falling demand on account of profit booking also hurts prices of these metals.