Informist, Monday, Jan 17, 2022
By Chinmay Mungse
MUMBAI – Gold contracts were trading higher on the Multi Commodity Exchange of India today tracking gains on the COMEX as weaker-than-expected US retail sales and provisional Consumer Sentiment Index, as detailed by the University of Michigan, boosted demand for safe haven metals.
* SILVER contracts were also trading higher on MCX, tracking gains in the COMEX contracts.
* US retail sales fell 1.9% in December against market expectations of them being flat and provisional Consumer Sentiment Index for January declined 2.5% because of a spike in inflation to 7% in December, a 40-year high.
* Analysts believe the surge in US inflation in December has lifted demand for GOLD despite the Federal Reserve hinting at an interest rate hike soon.
* “Precious metals traded up after US inflation reported another rise, making a strong bull case for inflation hedge despite a hawkish stance by the US Fed,” said Tapan Patel, senior analyst at HDFC Securities.
* Gold prices also received support from a weaker US dollar against a basket of major currencies. A weaker dollar makes dollar-denominated commodities cheaper.
* The upside in bullion prices was capped by rise in US Treasury yields. “The price came somewhat under pressure because the US treasury bond yields rose,” Commerzbank AG said.
* At 1731 IST, the most-active contracts of bullion were:
–February gold was up 0.3% at 47,899 rupees per 10 gm on MCX
–February gold was up 0.2% at $1,820.3 an ounce on COMEX
–March silver was up 0.5% at 61,930 rupees per kg on MCX
–-March silver was up 0.7% at $23.06 an ounce on COMEX
* Outlook for the evening session:
–MCX gold seen at 47,605-48,079 rupees
–COMEX gold seen at $1,811-$1,826
–MCX silver seen at 61,275-62,160 rupees
–COMEX silver seen at $22.53-$23.23
End
US$1 = 74.23 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Namrata Rao
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