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India Bullion: Up on MCX as weak dlr globally lifts COMEX contracts

Informist, Thursday, Jul 7, 2022


By Chinmay Mungse


MUMBAI – GOLD and SILVER contracts on the Multi Commodity Exchange were trading higher today, in line with contracts on global benchmark COMEX as the US dollar slipped off near 20-year highs.


* The US dollar witnessed some profit-taking following the recent strong bullish run. 


* Firm US dollar and hawkish minutes of the US Federal Reserve’s July meeting caused gold contracts to hit a 10-month low of $1,730.70 per ounce on Wednesday. Investors covered short positions after the steep fall, which also lent support to gold prices.


* The US Fed meeting minutes reaffirmed the market expectations of an aggressive stance from the central bank and indicated that another 50 or 75 basis points interest rate hike is likely in the July meeting to tame the rising inflation. 


* “The hawkish US Fed meeting minutes which suggested an even more restrictive stance could cap upside to gold prices,” said Sriram Iyer, senior analyst at Reliance Securities.


* Investors and market participants are now awaiting the US employment data releasing on Friday to gauge the scale of interest rate hikes. “If the labour market in the US is robust, the US Fed will take an aggressive path to tame inflation, which might pressure bullion prices further,” added Iyer.


* At 1708 IST, the most active contracts of bullion were:
   –August gold was up 0.3% at 50,674 rupees per 10 gm on MCX
   –August gold was up 0.3% at $1,742.4 an ounce on COMEX
   –September silver was up 0.9% at 57,257 rupees per kg on MCX
   –-September silver was up 1% at $19.30 an ounce on COMEX


* Outlook for the evening session:
   –MCX gold seen at 50,300-50,900 rupees,
   –COMEX gold seen at $1,720-$1,760
   –MCX silver seen at 56,170-57,410 rupees
   –COMEX silver seen at $18.79-$19.42





US$1 = 79.17 rupees

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT


Edited by Arshad Hussain


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Source: Cogencis

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