NEW DELHI: Gold prices were trading flat with a negative bias on Thursday as steady US dollar and elevated Treasury yields weighed on greenback-priced bullion.
Gold’s performance and outlook have also been under the cloud amid aggressive Fed monetary policy stance on rate hikes as the bank pushes to rein in soaring inflation.
Gold futures on
were trading marginally lower by 0.09 per cent or Rs 43 at Rs 50,175 per 10 grams. However, Silver futures dropped 0.18 per cent or Rs 110 at Rs 60,668 per kg.
Higher US short-term interest rates and bond yields raise the opportunity cost of holding bullion, which yields nothing. A stronger dollar makes gold less attractive for buyers holding other currencies.
Asian shares edged higher despite data reinforcing investor fears the global economic recovery may be more fragile than expected, even as inflationary pressures remain high.
Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities said gold trades marginally lower weighed down by a pause in recent slide in US dollar index and weaker ETF investor interest.
“Fed’s monetary tightening stance and safe haven buying helped US dollar index recover after three days of losses,” he added. “Gold may remain in a range amid countering factors.”
In the spot market, the highest purity gold was sold at Rs 50,283 per 10 grams while silver was priced at Rs 61,149 per kg on Wednesday, according to the Indian Bullion and Jewellers Association.
The spot prices of gold have remained below Rs 51,000 for the straight four sessions, whereas silver has jumped about Rs 2,000 per kg in the same number of sessions.
Trading Strategy
“We expect gold prices to trade sideways to up for the day with COMEX Spot gold support at $1,800 and resistance at $1,830 per ounce. MCX Gold June support lies at Rs 49,900 and resistance at Rs 50,600 per 10 grams,” Tapan Patel, Senior Analyst (Commodities),
Securities.
Global markets
Spot gold held its ground at $1,816.39 per ounce at 0242 GMT. US gold futures edged 0.1 per cent lower to $1,813.50.
Spot silver edged up 0.1 per cent to $21.41 per ounce, while platinum dropped 0.9 per cent to $927.37, and palladium slipped 0.6 per cent to $2,004.58.