Informist, Wednesday, Aug 3, 2022
By Chinmay Mungse
MUMBAI – GOLD contracts on the Multi Commodity Exchange rose today as the rupee fell against the dollar. A weaker rupee makes the greenback-denominated commodity expensive for Indian investors.
* The benchmark GOLD contracts on COMEX were in the red today on hawkish comments from US Federal Reserve members.
* Comments from US Fed’s Mary Daly, Loretta Mester and Charles Evans that the central bank is not done yet with monetary tightening hit sentiment for the yellow metal.
* “The markets were quick to react and assist the US treasury bond yields to recover swiftly from their lowest level since April. This is holding back bulls from placing aggressive bets around the non-yielding gold,” said fxstreet.com in a report.
* Robust haven demand following a dip in the dollar index drove the most active October gold contract on COMEX to a near one-month high of $1,794.8 per ounce on Tuesday, after which investors booked profits.
* “The US economy is clearly slowing down, and expectations of scaled back rate hikes have both greatly boosted gold prices,” said Angel One Commodities.
* However, the downside was limited by a weaker dollar against a basket of major currencies, the rising fears of global economic slowdown and escalating tensions between US and China over Taiwan.
* China condemned the US House of Representative Speaker Nancy Pelosi’s visit to China and responded with a flurry of military exercises, and announced the suspension of several agricultural imports from Taiwan.
* At 1653 IST, the most-active contracts of bullion were:
–October gold was up 0.3% at 51,525 rupees per 10 gm on MCX
–October gold was down 0.5% at $1,770.2 an ounce on COMEX
–September SILVER was flat at 57,623 rupees per kg on MCX
–-September silver was down 1% at $19.94 an ounce on COMEX
* Outlook for the evening session:
–MCX gold seen at 51,280-51,740 rupees
–COMEX gold seen at $1,752-$1,780
–MCX silver seen at 57,100-58,000 rupees
–COMEX silver seen at $19.84-$20.50.
US$1 = 79.16 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Aditya Sakorkar
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