Gold prices were steady at Rs 48,559 per 10 gram in the Mumbai bullion market on rupee appreciation against the dollar and lacklustre global cues. The precious metal is seeing support from safe haven demand on global uncertainties.
US Federal Reserve Chairman Jerome Powell in a testimony released on June 29 said the outlook for world’s biggest economy is 'extraordinarily uncertain' and will depend both on containing coronavirus and on government efforts to support the economy.
The concerns over rising coronavirus cases on fears of a second wave of infections is the constant upside factor for bullion prices. The World Health Organisation (WHO) recently warned of a worsening situation on lack of global cooperation. The market will await Powell's comments on June 30.
Market participants will also focus on GDP number expected from the UK and consumer confidence number from the US; a weaker than expected number could further support gold prices.
The bullion metal has been one of the top-performing across all asset classes in 2020, gaining 23.75 percent in rupee terms during the first half of the year.
The rate of the 10 gram 18, 22 and 24-carat gold in Mumbai was Rs 36,419, Rs 44,480 and Rs 48,559 plus 3 percent GST.
Navneet Damani, Vice President, Motilal Oswal, said fears over rising coronavirus cases around the world boosted demand for the safe-haven metal. "The broader trend on the COMEX could be in the range of $1,740-1,790/oz. On the domestic front, prices could hover in the range of Rs 47,900-48,550."
However, Ravindra Rao, VP- Head Commodity Research, Kotak Securities, warned that strength in the US Dollar Index will keep a check on gold gains.
The gold/silver ratio currently stands at 99.91 to 1, which means the amount of silver required to buy one ounce of gold.
Silver prices rose Rs 35 to Rs 48,600 per kg from its closing on June 29.
In the futures market, gold touched an intraday high of Rs 48,418 and an intraday low of Rs 48,180 on the Multi-Commodity Exchange (MCX). For the August series, the yellow metal touched a low of Rs 39,200 and a high of Rs 48,589.
Gold futures for August delivery eased Rs 40, or 0.08 percent, at Rs 48,204 per 10 gram in evening trade on a business turnover of 13,561 lots. The same for October delivery was down Rs 47, or 0.10 percent, at Rs 48,331 on a business turnover of 6,220 lots.
The value of the August and October contracts traded so far is Rs 2,634.71 crore and Rs 165.71 crore, respectively.
Similarly, Gold Mini contract for August slipped Rs 10, or 0.02 percent at Rs 48,231 on a business turnover of 10,415 lots.
At 12:05 (GMT), spot gold was marginally down $4.68 at $1,767.94 an ounce in London trading.For all commodities related news, click here