NEW DELHI: Gold prices slipped on Friday after a higher than expected inflation reading and rate hike signals from Fed ramped up odds for a hefty interest rate hike as soon as next month. A strong dollar and rise in bond yields also dented the gold prices.

Gold futures on MCX were trading down by 0.50 per cent or Rs 246 at Rs 48,709 per 10 grams. Silver futures were trading lower by 1.11 per cent or Rs 702 at Rs 62,564 per kg.

Ravi Singh, Vice President and Head of Research, ShareIndia said that US consumer prices rose solidly in January, leading to the biggest annual increase in inflation in 40 years. “This can fuel financial market speculation for an interest rate hike from the Federal Reserve next month and shooting benchmark U.S. and German treasury yields to multi-year highs” he added.

In the spot market, the highest purity gold was sold at Rs 48,901 per 10 grams while silver was priced at Rs 62,825 per kg on Thursday, according to the Indian Bullion and Jewellers Association.

The spot prices of gold have jumped more than Rs 1,050 per 10 grams since January 31, whereas silver has risen more than Rs 1650 per kg in the same period.

Trading strategy
“We expect gold prices to trade sideways to up for the day with COMEX Spot gold support at $1,815 and resistance at $1,840 per ounce. MCX Gold April support lies at Rs 48,600 and resistance at Rs 49,200 per 10 gram,” Tapan Patel, Senior Analyst (Commodities), HDFC Securities.

Global markets
Spot gold fell 0.1 per cent to $1,825.29 per ounce by 0141 GMT, while US gold futures dropped 0.7 per cent to $1,824.50.

Silver fell 0.3 per cent to $23.12 per ounce, platinum was down 0.5 per cent to $1,021.49, and palladium dropped 1 per cent to $2,231.70 per ounce.