Gold and silver prices witnessed sharp losses on Monday, tracking declines in global bullion markets amid fading hopes of a US Federal Reserve rate cut and rising inflation concerns. 

On the Multi Commodity Exchange (MCX), gold contracts for June 5 delivery opened 0.27 per cent lower at Rs 1,46,850 per 10 grams, as against the previous close of Rs 1,47,255. The yellow metal declined sharply during the session, falling as much as Rs 3,043, or 2.06 per cent, to hit an intraday low of Rs 1,44,212 per 10 grams.

Silver futures (May 5) also came under pressure, declining as much as 0.96 per cent to Rs 2,25,763 per kg, compared to the previous close of Rs 2,27,954.

In the international market, gold prices fell as a surge in energy prices due to the ongoing US-Iran conflict heightened inflation concerns and dampened expectations of interest rate cuts by the US Federal Reserve this year.

Spot gold declined 1.61 per cent to $4,420.48 per ounce, while spot silver dropped around 3 per cent to $67.69 per ounce.

In addition, COMEX gold fell 1.69 per cent to $4,447.50, while COMEX silver slipped nearly 3 per cent to $67.72.

Gold prices have declined around 15 per cent so far this month, marking their steepest monthly fall since October 2008. The drop has been driven by a stronger US dollar, which has gained over 2 per cent since the US-Israel conflict with Iran began on February 28. Silver prices have also plunged nearly 30 per cent from their March peak.

Analysts said gold continues to trade with a weak undertone despite intermittent safe-haven demand arising from geopolitical tensions.

They further stated that the near-term outlook for precious metals remains cautious, with prices likely to be driven by macroeconomic cues, interest rate expectations and geopolitical developments.