Informist, Thursday, Dec 16, 2021
By Chinmay Mungse
MUMBAI – GOLD and SILVER contracts on the Multi Commodity Exchange of India and COMEX were trading higher today as weaker than expected US retail sales data boosted the demand for bullion.
* US retail sales for November rose by 0.3% excluding automobiles, against analyst expectations of a 0.8% increase. Weaker retail sales weighed on the dollar index and boosted demand for gold.
* The US Federal Reserve wrapped up the two-day policy meeting on Wednesday and announced that it will wrap up the asset purchase tapering programme by March 2022 and pave the way for three-quarter percentage-point interest rate hikes by the end of 2022.
* “Economic activity is on track to expand at a robust pace this year, reflecting progress on vaccinations and the reopening of the economy,” said Federal Reserve chair Jerome Powell while addressing the press after the meeting.
* “Fed’s comments are in-line with investor expectations, hence the market has already sort of digested the remarks,” said Viresh Hiremath, director at Finlit Consulting Pvt Ltd.
* The dollar index lost its shine as a result of hawkish comments by the Fed, which boosted the demand for bullion. “The Fed’s hawkish stance on monetary policy is being weighed by a decline in the US dollar index after the policy meet, which encouraged a positive move in gold prices,” said Mahesh Kumar, head of commodities market at Abans Group.
* Meanwhile, gold holdings with SPDR Gold Trust fell by 2.9 tn to 977.7 tn on Wednesday, data on the website of the world’s largest gold exchange-traded fund showed. Silver assets with iShares Silver Trust remained steady at 16,846.02 tn.
* At 1654 IST, the most-active contracts of bullion were:
–February gold was up 0.7% at 48,400 rupees per 10 gm on MCX
–February gold was up 1.4% at $1,788.7 an ounce on COMEX
–March silver was up 2.1% at 61,500 rupees per kg on MCX
–-March silver was up 3.2% at $22.22 an ounce on COMEX
* Outlook for the evening session:
–MCX gold seen at 48,200-48,500 rupees
–COMEX gold seen at $1,770-$1,800
–MCX silver seen at 61,100-61,700 rupees
–COMEX silver seen at $21.90-$22.50. End
US$1 = 76.08 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Michael Correya
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Source: Cogencis
