Informist, Monday, Jan 16, 2023
By Chinmay Mungse
MUMBAI – GOLD and SILVER contracts traded higher on the Multi Commodity Exchange of India today due to a weaker rupee against the US dollar. A weaker rupee makes the greenback-denominated commodity more expensive for Indian investors.
* Benchmark GOLD contracts on the COMEX traded flat today as losses due to a sell-off in the contracts after hitting a nine-month high of $1,931.8 per ounce earlier today were offset by expectations of a slower pace of rate hikes from the US Federal Reserve.
* The US dollar also rebounded slightly after three sessions of losses, which also pressured bullion prices. However, expectations of a less hawkish US Fed kept the gains in the greenback limited.
* “The dollar stalls its recent downtrend and stages a solid intraday recovery from a seven-month low. This, in turn, is seen as a key factor weighing on gold price,” fxstreet.com said in a report. “That said, growing acceptance that the Fed will soften its hawkish stance, amid signs of easing inflationary pressures, could cap any meaningful upside for the greenback.”
* Investors and market participants are now eyeing the US producer’s price index data for December, due for release on Wednesday, for further cues on US inflation. The US consumer price inflation eased to 6.5% on year, which strengthened market expectations of a slower pace of rate hikes from the US Fed.
* At 1657 IST, the most-active contracts of bullion were:
–February gold was up 0.3% at 56,513 rupees per 10 gm on MCX
–February gold was flat at $1,920.3 an ounce on COMEX
–March silver was up 0.4% at 69,730 rupees per kg on MCX
–-March silver was flat at $24.37 an ounce on COMEX
* Outlook for the evening session:
–MCX gold seen at 56,300–56,700 rupees per 10 gm
–COMEX gold seen at $1,912–$1,960 an ounce
–MCX silver seen at 69,800-70,400 rupees per kg
–COMEX silver seen at $24.25-$24.75 an ounce
US$1 = 81.61 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Vidhi Verma
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