NEW DELHI: Gold prices were steady on Tuesday after hitting a one-week low in the previous session. The dollar weakened slightly ahead of US inflation data, which may offer clues about policy tightening by the Federal Reserve. The yellow metal was trading marginally higher in the domestic market.
US consumers expect the economy to continue its rapid resurgence from the Covid-19 pandemic over the next year, with forecasts for inflation, earnings, income growth and spending all increasing in June. The dollar index was mildly down. A weaker dollar makes gold less expensive for other currency holders.
British Prime Minister Boris Johnson urged people on Monday to show caution when nearly all remaining COVID-19 restrictions are lifted in England next week. WHO Director-General Tedros Adhanom Ghebreyesus said that the infectious Delta variant was becoming dominant and many countries had yet to receive enough vaccine doses.
Physical gold demand in India and other major hubs weakened last week as consumers were put off by a rise in the yellow metal’s price, while premiums for bullion also retreated.
Gold futures on MCX were up 0.14 per cent, or Rs 68, at Rs 47,842 per 10 gram. Silver futures gained 0.30 per cent, or Rs 209, to Rs 69,584 per kg.
“COMEX gold trades marginally higher near $1811/oz after a 0.3% decline yesterday. Gold inched up gaining support from virus concerns, China’s monetary easing measures, ECB’s shift in inflation strategy and uneven recovery,” said Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities.
In the spot market, highest purity gold was sold at Rs 47,846 while silver was priced at Rs 68,585 on Monday, according to the Indian Bullion and Jewellers Association.
“Weighing on price is continuing ETF outflows and recovery in bond yields from recent lows. Gold may witness choppy trade as Fed’s monetary policy is assessed; however with price holding above $1800/oz, the momentum looks positive.”
“We expect gold prices to trade sideways to up with COMEX Spot gold support at $1,795 and resistance at $1,820 per ounce. MCX Gold August support lies at Rs 47,500 and resistance at Rs 48,200 per 10 gram,” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
Spot gold rose 0.1% to $1,807.22 per ounce by 0120 GMT. It fell to its lowest level since July 6 of $1,790.49 on Monday. US gold futures were up 0.1% to $1,808.1.
Silver rose 0.3% to $26.24 per ounce, palladium fell 0.4% to $2,846.53 and platinum eased 0.2% to $1,115.68.