Informist, Thursday, Jun 30, 2022
By Chinmay Mungse
MUMBAI – GOLD and SILVER contracts on the Multi Commodity Exchange of India and COMEX fell today as the dollar index rose.
* The bets of a more aggressive interest rate hike by the US Federal Reserve increased following hawkish remarks by the US Fed Chair Jerome Powell on Wednesday. This further put pressure on bullion prices.
* Speaking at the European Central Bank’s annual forum on Wednesday, Powell said that the US economy is well-positioned to handle tighter policy and that the US central bank remains focused on getting inflation under control.
* “Powell’s comments supported the dollar and restricted gains of gold and silver,” said Manoj Jain, research head at Prithvi Finmart.
* However, the downside to bullion prices was capped by weaker than expected economic data. The US GDP for Jan-Mar contracted 1.6%, slightly more than the analyst expectations of a 1.5% contraction. Weaker US GDP triggered fears of an economic slowdown, which supported the safe-haven demand for precious metals.
* “The market sentiment remains fragile amid concerns that rapidly rising interest rates and tighter financial conditions would pose challenges to global economic growth,” said fxstreet.com in a report.
* Investors are awaiting the US personal consumption expenditure price index data release later in the day. The US PCE price index is expected to show the PCE inflation at 4.7% on year through May.
* At 1629 IST, the most active contracts of bullion were:
–August gold was down 0.3% at 50,588 rupees per 10 gm on MCX
–August gold was down 0.4% at $1,810.8 an ounce on COMEX
–July SILVER was down 0.7% at 58,650 rupees per kg on MCX
–-July silver was down 1% at $20.48 an ounce on COMEX
* Outlook for the evening session:
–MCX gold seen at 50,400-50,900 rupees,
–COMEX gold seen at $1,800-$1,830
–MCX silver seen at 59,011-60,919 rupees
–COMEX silver seen at $20.54-$20.99
End
US$1 = 78.96 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Maheswaran Parameswaran
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