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India Bullion: Down tracking COMEX on firm dollar; US CPI data eyed

Informist, Monday, Jul 11, 2022


By Chinmay Mungse


MUMBAI – GOLD and SILVER contracts on the Multi Commodity Exchange of India and COMEX were down today as a firm dollar against a basket of major currencies limited demand for the precious metals.


* Gold prices have been on a downward spiral recently as the US unit has risen steadily, while expectations of central banks raising interest rates have reduced demand for the yellow metal. 


* Last week, data from the US labor department showed that the country added 100,000 more jobs than initially expected, which also weighed on gold prices. “The US employment data showed a healthy sign, which eased some recession fears, raising expectations of more monetary tightening from the US Federal Reserve,” said Tapan Patel, senior analyst at HDFC Securities.


* Investors are now focussing on the US consumer price index data, scheduled to be released on Wednesday. According to a poll by Dow Jones, US CPI is seen higher on month at 8.8%, which might compel the Fed to stick to aggressive monetary policy tightening.


* According to the CME FedWatch indicator, more than 93% of market participants expect the Fed to raise interest rates by 75 basis points to 2.25-2.50% at its upcoming policy meet this month.


* At 1655 IST, the most active contracts of bullion were:
   –August gold was down 0.2% at 50,693 rupees per 10 gm on MCX
   –August gold was down 0.4% at $1,735 an ounce on COMEX
   –September silver was down 0.1% at 57,054 rupees per kg on MCX
   –-September silver was down 0.3% at $19.13 an ounce on COMEX


* Outlook for the evening session:
   –MCX gold seen at 50,100-51,050 rupees
   –COMEX gold seen at $1,714-$1,754
   –MCX silver seen at 56,066-57,250 rupees
   –COMEX silver seen at $18.73-$19.43




US$1 = 79.44 rupees

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


Edited by Aditya Sakorkar


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Source: Cogencis

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