Gold slips Rs 217 per 10 gram, silver remains flat

Gold prices slipped Rs 217 to Rs 46,479 per 10 gram in the Mumbai bullion market on the back of a strengthening dollar against the rupee. The precious metal had come under sharp selling pressure on June 5 after the US non-farm payrolls data showed a surprise rise of 2.5 million jobs in May, boosting optimism about an economic recovery and denting gold's safe-haven appeal.

Bullion dealers offered discounts up to $32 an ounce, the highest in about two months, due to poor customers’ response as they preferred to stay at home due to rising coronavirus cases in the country, Reuters reported.

The rate of 10 gram 18-, 22- and 24-carat gold in Mumbai was Rs 34,859, Rs 42,575 and Rs 46,479 plus 3 percent GST.

No major economic data is due on June 8 which might keep gold choppy as market players await fresh cues after the sharp fall in the previous week.

Ravindra Rao, VP-Head Commodity Research at Kotak Securities, said commodities in international market trade mixed as market players await fresh cues after the sharp up move in the last few days. Market players are assessing the economic data from major economies to gauge impact of the virus outbreak. "The trading range for the day would be $1700 to $1680/oz."

The gold/silver ratio currently stands at 97.23 to 1, which means the amount of silver required to buy one ounce of gold.

Silver prices remained unchanged at Rs 47,800 per kg from its closing on June 5.

In the futures market, gold touched an intraday high of Rs 46,100 and an intraday low of Rs 45,793 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 48,190.

Gold futures for August delivery gained Rs 242, or 0.53 percent, at Rs 45,940 per 10 gram in evening trade on a business turnover of 13,686 lots. The same for October delivery rose Rs 257, or 0.56 percent, at Rs 46,120 on a business turnover of 5,450 lots.

The value of the August and October contracts traded so far is Rs 2,326.99 crore and Rs 90.82 crore, respectively.

Similarly, Gold Mini contract for July was up Rs 223, or 0.49 percent at Rs 45,931 on a business turnover of 10,680 lots.

Gold resistance is capped at Rs 46,100-46,190 whereas support is placed at Rs 45,850-45,730 levels, according to Motilal Oswal. The broking firm sees support for spot gold at $1,685-1,680 and resistance at $1,702-1,710/oz.

At 12:01 pm (GMT), spot gold gained $7.41 at $1,692.59 an ounce in London trading.

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