Gold prices in India traded lower on the Multi Commodity Exchange (MCX) Thursday following weakness in international spot prices amid a strong dollar. However, US Federal Reserve’s pledge to keep rates near zero levels for some time to reach 2% inflation target lent support to the yellow metal prices, analysts said.
At 10:50 am, gold futures for October delivery fell 0.68 percent to Rs 51,470 per 10 grams as against the previous close of Rs 51,824 and opening price of Rs 51,710 on the MCX. Silver futures traded 1.29 percent lower at Rs 67,891 per kg. The prices opened at Rs 67,900 as compared to the previous close of Rs 68,781 per kg.
“The gold prices declined after the US Fed’s comments supported the dollar. Recent developments over COVID vaccine also pressurized pecious metal. The bearish trend in gold may remain due to stronger dollar,” said Ajay Kedia, director, Kedia Commodity Comtrade.
International gold prices fell more than 1 percent on Thursday as the dollar climbed after the US Federal Reserve painted a favourable economic recovery picture but stopped short of offering concrete signals on further stimulus, a Reuters report said.
Spot gold was down 1.1 percent to $1,938.12 per ounce. US gold futures slipped 1 percent to $1,951.30.
The Fed signalled it expected the US economic recovery from the coronavirus crisis to accelerate, with unemployment falling faster than the central bank's forecast in June. The dollar index rose to a more than one-week high against its rivals following the Fed's comments. This made gold more expensive for holders of other currencies.
“As far as resistance level of $1,980 on COMEX and Rs 52,100 on MCX is not breached, gold may trade bearish. Support is placed at $1,920 level. On MCX, support for gold is seen at Rs 51,000 level. For Silver, support is seen Rs 65,200 level while resistance is placed at Rs 70,000 level,” Kedia added.
The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.)