NEW DELHI: Gold and silver futures prices were trading with marginal gains as low level buying was seen early on Tuesday after a sharp fall a day prior. However, the gains were checked as dollar rose.

The dollar index held near a 16-month peak after Biden on Monday nominated Fed Chair Powell for a second four-year term, bolstering bets the central bank might raise interest rates sooner to curb growing inflation. A stronger dollar increases bullion’s cost to buyers holding other currencies.

Gold futures on MCX were up 0.07 per cent or Rs 35 at Rs 47,958 per 10 grams. Silver futures rose 0.15 per cent or Rs 97 to Rs 64,668 per kg.

“The yellow metal halted decline after witnessing selling in the previous session. Gold prices declined on a stronger dollar and a rally in US bond yields on Europe Covid worries. US 10-year treasury yields rose to 1.62 per cent up from 1.56 per cent of previous week. Gold prices also fell after the US President nominated Jerome Powell for the second term of Fed chairman,” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.

In the spot market, the highest purity gold was sold at Rs 48,834 while silver was priced at Rs 65,829 on Monday, according to the Indian Bullion and Jewellers Association.

Trading strategy
“After the news of Powell’s reappointment, the US treasury yields surged as traders are perceiving that a more dovish policy may be paving its way. We expect this weakness in gold to continue till Rs 47,500. Buy zone is above Rs 48,250 for the target of Rs 48,500. Sell zone below Rs 47,850 for the target of Rs 47,500,” said Ravi Singh, Vice President & Head of Research, ShareIndia.

Global markets
Spot gold rose 0.2 per cent to $1,809.40 per ounce by 0048 GMT, after sliding 2.1 per cent to its lowest since Nov. 5 on Monday. U.S. gold futures gained 0.2 per cent to $1,809.60.

Spot silver rose 0.4 per cent to $24.25 per ounce. Platinum gained 0.4 per cent to $1,015.51 and palladium rose 1.3 per cent to $1,978.97.