On Friday, gold prices fell in the international markets for the second consecutive day as the American dollar and US Treasury yields firmed.
Mirroring movement, the precious metal's rates in India also declined with gold futures (February 2021) on MCX (Multi Commodity Exchange of India) trading 0.5% lower at Rs 50,666 per 10 grams at the time of writing.
US spot gold was down 0.3% to $1,907.66 per ounce, however, it is on course for a second straight weekly gain with 0.5% gain so far this week on hopes of additional stimulus in the US.
Earlier this week, vote counting results showed that Democrats won both Georgia Senate seats, gaining a majority in the US Senate. The party's majority hold in the Senate is expected to dramatically improve the fate of President-elect Joe Biden's progressive agenda. It has also fuelled hopes of large stimulus measures to aid recovery of the world's largest economy from the pandemic downturn.
On the other hand, the benchmark 10-year US bond yield scaled a fresh high since March, holding above 1%, and helping the American dollar rebound strongly.
A stronger dollar makes bullion more expensive for holders of other currencies, while higher bond yields increase the opportunity cost of holding the non-interest yielding gold.