Gold falls Rs 490 to Rs 96,540 per 10 g; silver declines by Rs 1,000 per kg

New Delhi, May 20: Gold prices fell by Rs 490 to Rs 96,540 per 10 grams in the national capital on Tuesday due to weak demand, according to the All India Sarafa Association.

The yellow metal of 99.9 per cent purity had closed at Rs 97,030 per 10 grams on Monday.

Gold of 99.5 per cent purity depreciated by Rs 450 to Rs 96,130 per 10 grams (inclusive of all taxes). It had settled at Rs 96,580 per 10 grams in the previous market close.

"Gold traded with a modest intraday loss on Tuesday. Ongoing optimism about the US-China trade truce, along with expectations for a ceasefire between Russia and Ukraine, continues to enhance positive risk sentiment and weaken the appeal of the safe-haven bullion," Saumil Gandhi, Senior Analyst of Commodities at HDFC Securities, said.

Silver prices plunged by Rs 1,000 to Rs 97,500 per kg (inclusive of all taxes) on Tuesday from the previous close of Rs 98,500 per kg.

Traders seem uncertain about the US Federal Reserve's (Fed) future interest rate cuts path after the hawkish stance taken by another Fed member, which has also adversely affected gold prices, Gandhi added.

Spot gold in the overseas market went up marginally to USD 3,233.68 per ounce.

Kotak Securities' AVP-Commodity Research Kaynat Chainwala said investors are awaiting speeches from several US Federal Reserve officials later in the day for monetary policy cues.

However, sharp downside may be limited ahead of a key House vote on President Donald Trump's major tax and spending package, which could further widen the US fiscal deficit, Chainwala said.