India Bullion: Down on firm rupee, COMEX slips on strong China data
Monday, Dec 2
By Roshni Devi
MUMBAI – A strong rupee against the US dollar and the fall in parent contracts on COMEX weighed on bullion contracts on the Multi Commodity Exchange of India today, analysts said.
A firm rupee makes the import of dollar-denominated commodities such as gold cheaper.
On COMEX, better-than-expected economic data from China deflated gold’s appeal as a haven asset. China is the largest consumer of gold.
At 1830 IST, the February gold contract on MCX was 0.5% lower at 37,825 rupees per 10 gm and the same-month contract on COMEX was down 0.7% at $1,463.20 an ounce.
According to latest data, China’s Caixin manufacturing purchasing managers’ index rose to 51.8 in November, the strongest pace since Dec 2016.
“Relatively good Chinese data are causing the gold price to correct again as the new week gets under way. This could be a sign that the Chinese economy is stabilising at a low level,” a report by Commerzbank AG said.
Record high US equities and strength in the dollar against the euro have also hit gold’s appeal. “US stock markets have hit record highs recently amid optimism that the US and China will agree an initial trade deal soon. This has resulted in bond yields edging up and the gold price slipping back,” Heraeus Precious Metals said in a report.
The March silver contract on MCX was down 0.8% at 44,705 rupees per kg and the same-month contract on COMEX was 0.9% lower at $16.95 an ounce.
For the rest of the day, the December gold contract on MCX is seen at 37,780-38,220 rupees per 10 gm, and at $1,450-$1,467 an ounce on COMEX.
The December silver contract on COMEX is seen at $16.70-$17.20 an ounce and at 44,500-45,500 rupees per kg on MCX. End
US$1 = 71.65 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Subham Mitra
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