Trump's victory will bring a record fall in gold, its price will go down by this much

Donald Trump Victory: As soon as the results of the 2024 presidential election in the US came out, there was a stir in the markets around the world. While the Indian and American stock markets embraced Donald Trump's victory with great enthusiasm, there was a huge decline in the prices of gold and silver. Gold prices in the Indian futures market came down by more than Rs 1850, while silver also registered a big decline of about Rs 3800 per kg. The same effect of fall in gold and silver prices was seen in foreign markets as well. Gold spot prices fell by more than $ 80 an ounce in the Comex market in New York and silver spot prices also fell by about 4.50 percent.

Major reasons for decline

1. Rise in dollar index:

After the victory of Donald Trump, there was a tremendous jump in the dollar index, due to which investors turned away from safe investment instruments. Due to the strength of the dollar, the pressure on gold prices has increased, and investors are now investing more in the dollar, leading to a decline in the prices of gold and silver.

2. Technical profit booking:

In the last three months, gold prices had increased by about 9 percent (Rs 6500 per 10 grams). After this increase, a phase of profit booking has started, in which investors are converting their profits into cash. This profit booking is also a major reason for the fall in gold prices.

3. Uncertainty from Fed Reserve meeting:

The upcoming meeting of the US Federal Reserve will decide on interest rates, in which the expectations of reduction have already reduced. The market was expecting that the Fed could cut interest rates by 0.50 percent, but now after Trump's re-election, the possibility of reduction has come down to 0.25 percent. Due to this, there is also a decline in gold prices.

4. Decrease in local demand:

After big festivals like Diwali in India, the wedding season shopping is also almost complete. Due to the decrease in local demand for gold, there is pressure on gold prices in the Indian market as well. Due to the increase in old stock, shopkeepers are not buying new gold, due to which prices are falling further.

5. Impact of Trump's victory on Fed policies:

Donald Trump opposed the Federal Reserve's policy of cutting interest rates during his campaign. After Trump's victory, investors have formed the impression that the Fed will not cut interest rates further, which has had a negative impact on investment in gold.

Possible gold prices in the coming months

Experts believe that by the end of the year, gold prices may fall further by 3 to 5 percent. As a result, gold prices on MCX may come down to Rs 73,000 to Rs 75,000 per ten grams. According to Ajay Kedia, director of Kedia Advisory, the price of gold in the international market may go below $ 2,600 an ounce. The effect of the strength of the dollar may be more clearly visible in the coming days and profit booking in gold may continue.

Silver prices also fell sharply

On Wednesday, a big fall was also seen in the price of silver in the Indian futures market. Silver prices on the Multi Commodity Exchange (MCX) fell by Rs 3,828 to close at Rs 90,820 per kg. During trading, silver prices came down to Rs 90,020 per kg, which was at Rs 94,648 a day earlier. The effect of this decline was also seen in foreign markets, where silver spot prices on Comex fell by 4.57 percent and the price reached $ 31.17 an ounce.

Fall in gold and silver prices in foreign markets

Gold futures fell by more than $ 81 an ounce to $ 2,668.70 an ounce in New York's Comex market. At the same time, gold spot saw a decline of $ 85, and the price was at $ 2,659.40 an ounce. The effect of the fall in gold and silver prices was also clearly visible in the British and European markets. In the British market, the price of silver closed at 24.19 pounds per ounce with a fall of 3.38 percent, while in the European market it closed at 29.05 euros per ounce with a fall of 2.80 percent.

Conclusion

Donald Trump's victory has created an environment of boom in the stock markets and fall in the prices of gold and silver. The strength of the dollar index and the decrease in demand in the local markets have increased the pressure on the prices of gold and silver. According to experts, this decline may continue till the end of the year, due to which investors should wait for the stability of the market before investing in gold and silver.