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Gold prices fall to Rs 47,239 per 10 gm on rupee uptick; silver slumps by Rs 402 a kg

The broader range on COMEX could be $1800-1830 and on the domestic front, prices could hover in the range of Rs 46,980- 47,575.

Mumbai / August 31, 2021 / 07:21 PM IST
Gold

Gold

Gold prices declined by Rs 239 to Rs 47,239 per 10 gram in the Mumbai retail market on a continued uptrend in the rupee and buoyant equity market. However, the yellow metal benefitted from the dollar weakness and the Fed Chair’s comment from last week that pacified concerns of a faster monetary tightening.

The price of 10 gram, 22-carat gold in Mumbai was Rs 43,271 plus 3 percent GST, while 24-carat 10 gram stood at Rs 47,239 plus GST. The 18-carat gold is quoted at Rs 35,429 plus GST in the retail market.

The focus now will be on the US consumer confidence data scheduled later in the day.

Gold holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, remained unchanged for the third day at 1,001.72 tonnes, the lowest since April 2020. The ETF has a market value of $57.90 billion.

The US dollar index traded lower at 92.45, down 0.21 percent against a basket of six rival currencies.

Close

Spot gold moderately rose by $3.01 to $1,813.35 an ounce at 1216 GMT in London trading.

MCX Bulldesk slightly gained by 1 point or 0.01 percent at 14,169 at 17:46. The index tracks the real-time performance of MCX Gold and MCX Silver futures.

“Gold prices were underpinned by a subdued dollar, with investors looking ahead to US non-farm payrolls data, which could be key to the Federal Reserve’s tapering decision. The dollar continued to hover near the two-week lows after Fed chief Jerome Powell gave no signal regarding the central bank’s tapering timeline except that it could be “this year. China’s factory activity expanded at a slower pace in August as coronavirus-related restrictions and high raw material prices pressure manufacturers in the world’s second-largest economy,” said Navneet Damani, VP – Commodities Research at Motilal Oswal Financial Services.  

The broader range on COMEX could be $1800- 1830 and on the domestic front, prices could hover in the range of Rs 46,980- 47,575.

The gold-silver ratio currently stands at 74.50 to 1, which means 74.50 ounces of silver is required to buy an ounce of gold.

Silver prices decreased by Rs 402 to Rs 63,402 per kg against its closing price on August 30.

In the futures market, the gold rate touched an intraday high of Rs 47,332 and an intraday low of Rs 47,036 on the Multi-Commodity Exchange (MCX). For the October series, the yellow metal touched a low of Rs 45,662 and a high of Rs 50,040. 

Gold futures for October delivery fell by Rs 60, or 0.13 percent, to Rs 47,104 per 10 gram in evening trade on a business turnover of 11,435 lots. The same for December dropped by Rs 72, or 0.15 percent, to Rs 47,250 on a business turnover of 3,427 lots.

The value of October and December’s contracts traded so far is Rs 1,478.39 crore and Rs 74.34 crore, respectively.

Similarly, Gold Mini contract for September declined Rs 14, or 0.03 percent at Rs 47,035 on a business turnover of 324 lots.

Trading Strategy

Tapan Patel- Senior Analyst (Commodities), HDFC Securities

Gold prices traded off the recent highs paring some previous gains. The traders and investors will now try to gauge the FED mood from upcoming US data after the Jackson Hole meeting. The weak Chinese data may support gold prices while silver prices may limit upside on weak industrial metals. 

We expect gold prices to trade sideways to up with COMEX spot gold resistance at $1,833 and support at $1,795 per ounce. MCX Gold October support lies at Rs 46,900 and resistance at Rs 47,500 per 10 gram.

Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited

Technically, International Gold is trading with a marginal positive bias above $1,810. The market may continue to rise and trade above $1,820 levels during the evening hours. On the domestic front, MCX Gold October has declined more than 150 points since then. We may expect the prices to trade with bearish bias in the evening session and test Rs 47,000 levels.

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Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Sandeep Sinha
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