Informist, Wednesday, May 10, 2023
By Sandeep Sinha
MUMBAI – Futures contracts of gold fell on the Multi Commodity Exchange of India and COMEX today because of reduced safe-haven appeal and outflows in gold exchange-traded funds. The dollar index recouped losses and rose ahead of US consumer price index data, which also weighed on prices.
The dollar index, which measures the strength of the greenback against a basket of six major currencies, was up 0.2% at 101.75. A firm greenback makes precious metals priced in dollars expensive for holders of other currencies.
Gold holdings with SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell by 2.6 tn to 934.95 tn. The fund has a market value of $61.0 bln.
“Hotter-than-expected CPI might push back expectations of rate cuts by the Fed, which might be a headwind for bullions in short term,” Kotak Securities said in a note.
“A slight miss in the US CPI inflation data reading may not make a sustainable difference to gold prices, while even a slightly higher reading may weigh on prices of the yellow metal,” said Praveen Singh, associate vice president, fundamental currencies and commodities at Sharekhan by BNP Paribas.
“Dip buying is preferred over chasing the rally trade — simmering tension between Europe and China is supportive for gold,” Singh said.
The spot gold-silver ratio, also known as mint ratio, was lower at 79.51, indicating that silver has outperformed gold. The ratio measures the ounces of silver required to buy an ounce of gold.
MCX Bulldex, an index tracking the real time performance of gold and silver futures on the MCX, was down 29 points, or 0.2%, at 16714 points as of 1735 IST.
As of 1735 IST, the June and August gold contracts recorded turnovers of 14.68 bln rupees and 1.38 bln rupees, respectively.
At the same time, the July and September silver contracts saw a turnover of 10.64 bln rupees and 225.79 mln rupees, respectively.
* At 1735 IST, the most-active contracts of bullion were:
–June gold was down 0.3% at 61,246 rupees per 10 gm on MCX
–June gold was down 0.3% at $2,036.35 an ounce on COMEX
–July silver was down 0.4% at 77,181 rupees per kg on MCX
–-July silver was down 0.4% at $25.79 an ounce on COMEX
* Outlook for the rest of the session:
–MCX gold seen at 60,850–61,800 rupees per 10 gm
–COMEX gold seen at $2,017–$2,045 an ounce
–MCX silver seen at 75,800-78,200 rupees per kg
–COMEX silver seen at $25.28-$25.85 an ounce
End
US$1 = 81.98 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Tanima Banerjee
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Source: Cogencis
