Mumbai, May 11, 2026, 16:36 IST
Gold dropped nearly 1% Monday, pressured by an oil rally that followed faltering U.S.-Iran peace talks and reignited inflation and rate worries among bullion traders. Spot gold slipped 1% to $4,667.99 an ounce by 0852 GMT. U.S. June gold futures slid 1.1%. “Inflation risks still weigh heavy on the market’s collective mind,” noted Han Tan, chief market analyst at Bybit. Reuters
For India, this isn’t just another blip in metals trading. The rupee slid to a fresh record—95.31 per dollar—after Brent crude climbed 2.5% to $103.8 a barrel. Shipping through the Strait of Hormuz remains blocked. That lift in oil prices puts India at risk: a wider current account deficit, sluggish growth, and hotter inflation, Reuters noted.
Pressure built on the domestic front after Prime Minister Narendra Modi called on citizens to hold off on buying gold for a year—a move aimed at safeguarding foreign exchange reserves. Titan, Senco Gold, and Kalyan Jewellers all saw shares tumble, dropping anywhere from 6% to 9%. Surendra Mehta, national secretary of the India Bullion and Jewellers Association, flagged fresh worries the government might “sharply increase import duty on gold.” Still, a government source insisted there’s no plan right now to hike duties on gold or silver imports. Reuters
The broader market took a blow as well. Arun Kejriwal, who runs Kejriwal Research and Investment Services, described Monday’s drop as a “knee-jerk reaction” to remarks from Modi. Still, he pointed to stubbornly high oil prices—“oil refusing to fall and hold below $100”—as the more persistent concern, even with moves toward peace talks between Iran and the U.S. Reuters
Physical gold in Gujarat was already under pressure this past weekend. According to Gujarat Samachar, Mumbai’s official bullion market stayed closed on Saturday, but dealers still cut their off-market offers to match declines overseas; 995-purity gold in Ahmedabad dropped ₹500 to ₹155,200 per 10 grams, and silver fell ₹2,000 to ₹250,000 a kilo. Mumbai gold—GST excluded—was also down ₹500.
On May 11, IBJA quoted 999-purity gold — 24-carat, nearly pure — at ₹151,140 per 10 grams for the morning, then ₹151,078 in the afternoon, both figures pre-GST. Silver 999 clocked in at ₹255,200 for the AM session, ticking up to ₹255,600 in the PM update.
June gold on MCX slipped ₹462, or 0.3%, to ₹152,068 per 10 grams this afternoon, with 1,337 lots changing hands. In Ahmedabad’s retail market, 24-carat gold quotes dropped ₹22 to ₹15,218 per gram; 22-carat was pegged at ₹13,950.
But this drop follows a notable jump just a week earlier. Sandesh, referencing GoodReturns, noted on May 10 that 24-carat gold climbed ₹1,640 for the week, and 22-carat gained ₹1,500; silver surged ₹10,000 to ₹275,000 per kg in morning retail quotes.
It wasn’t just gold showing divergence. Copper climbed to $6.31 per lb on May 11, gaining 0.99% that day and tracking a 5.60% monthly advance. Brent and WTI crude also moved higher. Copper is closely followed as a barometer for industrial demand, thanks to its heavy use in construction, power, and electronics.
Risks aren’t one-directional for buyers here. Should oil prices remain elevated and U.S. rate cuts slip even further down the timeline, gold could keep feeling the weight—after all, it pays no yield. BofA Global Research and Goldman Sachs have both pushed their forecasts for Federal Reserve rate cuts to later dates, pointing to inflation stoked by energy costs and a still-robust labour market. “Data flow precludes cuts for now,” BofA analysts said. Reuters
