Gold prices plunge by Rs 185 on global cues

Falling for the second straight day, gold prices declined by Rs 185 to hit over three-month low of Rs 26,165 per 10 grams at the bullion market on Tuesday on a weakening global trend amid low demand from jewellers.

Silver also dropped by Rs 400 to Rs 35,650 per kg on reduced offtake by industrial units and coin makers.

Traders said weakening global trend where gold held near a three-month low, as investors weighed the outlook for higher US interest rates before the Federal Reserve begins a two-day meeting, mainly influenced the prices of precious metals.

Gold in Singapore, which normally sets price trend on the domestic front, fell by 30 cents to $1,154.51 an ounce and silver by 0.4 per cent to $15.58 an ounce.

In addition, sluggish demand from jewellers and retailers dampened the sentiment, they said.

In the national capital, gold of 99.9 and 99.5 per cent purity fell by Rs 185 each to Rs 26,165 and Rs 26,015 per 10 grams, respectively.

Sovereign, however, continued to trade at last level of Rs 23,600 per piece of eight grams.

In line with gold, silver ready prices dropped by Rs 400 to Rs 35,650 per kg and weekly-based delivery by Rs 440 to Rs 35,365 per kg.

Silver coins also plummeted by Rs 1,000 to Rs 55,000 for buying and Rs 56,000 for selling of 100 pieces.