Ravindra Rao, VP- Head Commodity Research at Kotak Securities, does not expect a sustained decline as the US Federal Reserve’s dovish stance may limit upside in the dollar
Gold prices declined for the second successive day by Rs 257 to 50,927 per 10 gram in the Mumbai market on rupee depreciation versus the dollar and tepid global cues. The yellow metal prices fell after the dollar surged against major currencies and on strong economic data in the US and China, which boosted investor appetite for riskier assets.
The US Dollar Index, measured against a basket of six currencies, gained 0.21 percent to trade at 93.02.
US manufacturing data showed activity accelerated to a near two-year high in August, increasing optimism about an imminent recovery in the US economy.
The rate of the 10 gram 18, 22 and 24-carat gold in Mumbai was Rs 38,195, Rs 46,649 and Rs 50,927, respectively, plus 3 percent GST.
The rally in the global equities and steep discount in the Indian and Chinese markets due to weak consumer demand also weighed on bullion prices.
MCX iCOMDEX Bullion Index was down 18.82 points, or 0.12 percent, at 15,934.91 at 17:32. The index tracks real-time performance of MCX Gold and MCX Silver futures.
“Losses for the yellow metal could get restricted on hopes of more stimulus from the US,” said Navneet Damani, Vice President, Motilal Oswal. He expects international and domestic prices to hover in the range of $1,920-1,985 per troy ounce (COMEX) and Rs 50,520-51,980, respectively.
Ravindra Rao, VP- Head Commodity Research at Kotak Securities, too does not expect a sustained decline as the US Federal Reserve’s dovish stance may limit upside in the dollar.
The gold-to-silver ratio currently stands at 79.08 to 1, which means the amount of silver required to buy one ounce of gold.
Silver prices decreased Rs 1,528 to Rs 64,393 per kg from its closing on September 2.
In the futures market, gold touched an intraday high of Rs 50,964 and a low of Rs 50,600 on the Multi-Commodity Exchange (MCX). In the October series, the yellow metal has touched a low of Rs 45,596 and a high of Rs 56,191.
Gold futures for October delivery slipped Rs 36, or 0.07 percent, at Rs 50,785 per 10 gram in evening trade on a business turnover of 14,219 lots. The same for December delivery edged lower by Rs 30, or 0.06 percent, at Rs 51,097 on a business turnover of 4,967 lots.
The value of the October and December’ contracts traded so far is Rs 3,515.51 crore and Rs 202.03 crore, respectively.
Similarly, Gold Mini contract for October was down Rs 16, or 0.03 percent, at Rs 50,890 on a business turnover of 17,339 lots.
At 12:18 (GMT), spot gold was down $13.15 at $1,929.82 an ounce in London trading.For all commodities related news, click here