Gold at eight-month low, headed for worst week since November. Here's what you should do

Gold prices seem to be headed for their worst week since the end of November, falling for the sixth consecutive day in a row.

International gold prices have declined 3% so far this week, as the recent strength in US Treasury yields has dented the metal’s appeal.

Gold was one of the best-performing commodities last year with prices witnessing the highest annual gain in a decade.

In India, gold had surged to a record Rs 56,200 per 10 gram.

Currently, gold is hovering near the Rs 46,000-mark, down Rs 10,000 from the August 2020 peak.

MCX Gold was trading with negative bias at 12:00 noon on February 19, but was holding above the crucial support of Rs 46,000.

March silver futures were trading 0.6% lower at Rs 68,055 per kilogram

Several reasons have led to the decline in gold price in India.

Import duty cut announced in the budget is one major reason why gold prices have been on a declining trend.

The second reason for gold to head south is the appreciation of the rupee against the US dollar.

As for the outlook on gold prices going forward, Kunal Shah, Head of Commodities Research, Nirmal Bang said: “Gold and silver prices have remained under pressure on account of rising US dollar and rising bond yield due to better than expected growth outlook of the global economy and Covid-19 vaccination has led to some profit taking in but long term outlook of gold and silver continues to remain strong due to massive expansion of balance of central bankers.”

Shah believes one can look at buying gold at lower levels for a target of Rs 47,000 and also buy silver for a one month target of Rs 70,000.