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Gold rate today: Yellow metal jumps on US-China tensions; may face resistance at Rs 47,400 per 10 grams

Gold rate today: Yellow metal jumps on US-China tensions; may face resistance at Rs 47,400 per 10 grams

Gold rate today: Yellow metal jumps on US-China tensions; may face resistance at Rs 47,400 per 10 grams
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By Ankit Gohel  May 22, 2020 2:53:57 PM IST (Updated)

Gold prices in India jumped on the Multi Commodity Exchange (MCX) Friday following international spot prices as escalating tensions between the United States and China dampened risk appetite. Weakness in rupee also supported gains in the yellow metal, analysts said.

Gold prices in India jumped on the Multi Commodity Exchange (MCX) Friday following international spot prices as escalating tensions between the United States and China dampened risk appetite. Weakness in rupee also supported gains in the yellow metal, analysts said.

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At 2:15 pm, gold futures for June delivery rallied 1.43 percent or Rs 662 to Rs 47,050 per 10 grams as against the previous close of Rs 46,388 and opening price of Rs 46,466 on the MCX. Silver futures traded 1.13 percent higher at Rs 47,870 per kg. The prices opened at Rs 47,227 as compared to the previous close of Rs 47,335 per kg.
“Rising tension between US and China as China plans controversial national security laws in Hong Kong support the gold prices. Although the increased jobless claims in US and dovish data also is supportive for the Gold,” said Anuj Gupta, DVP–Commodities & Currencies Research, Angel Broking.
In the international market, gold prices gained as an escalation in US-China tensions underpinned bullion's safe-haven appeal, although positive economic indicators after some countries eased lockdowns set up the precious metal for a weekly drop.
Spot gold was up 0.2 percent at $1,727.75 per ounce by 0524 GMT, having dropped 1.4 percent on Thursday. US gold futures rose 0.4 percent to $1,729.40.
“The US-China tensions and rising investment demand in gold due to the economic slump on account of COVID-19 are supporting yellow metal prices,” said Ajay Kedia, Director, Kedia Commodity.
Indian equity markets declined on Friday amid weak rupee that lent support to gold prices.
Meanwhile, gold and silver prices fell sharply in the previous session on Thursday after better-than-expected US economic data and gains in the dollar index.
If the gold price breaches $1,720 levels, it may fall to near $1,680 in the international market, Kedia added.
“On MCX, gold may face resistance at Rs 47,400 while support is placed at Rs 46,200 level. If gold falls below Rs 46,200, we may see a further decline towards Rs 45,500 levels,” Kedia added.
Analysts believe that the upside in the gold is limited as the reopening of economies and business activities would support risk appetite.
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