Informist, Monday, Feb 28, 2022
By Chinmay Mungse
MUMBAI – GOLD and SILVER contracts on the Multi Commodity Exchange of India and COMEX gained today after the US, UK and the European Union imposed a second tranche of sanctions on Russia, boosting the demand for the safe-haven metals.
* The US, UK and European Union have adopted sanctions aimed at freezing the assets of Russian President Vladimir Putin and Sergei Lavrov, his foreign minister, in response to the war in Ukraine.
* They have also imposed sanctions on the Bank of Russia and removed some of the country’s leaders from the Society for Worldwide Interbank Financial Telecommunication global payments system.
* Putin ordered his defence chiefs to put the country’s nuclear “deterrence forces” on high alert on Sunday, increasing concerns over the possibility of a nuclear war, which further supported gold prices in the international markets, said analysts.
* “All of this is cause for concern and is prompting price fluctuations on the markets accordingly. Gold is in demand as a safe haven in this environment,” said Commerzbank AG.
* Analysts expect gold prices to rise further if another set of sanctions to curb the Russian economy are imposed.
* “If more sanctions are imposed, Bank of Russia will aggressively buy gold assets, thus boosting the demand for the yellow metal,” said Sriram Iyer, senior analyst at Reliance Securities.
* Apart from geopolitical tensions, higher inflation in the US also supported gold prices in the international market. US personal consumption expenditure index on Friday rose 5.2% for the year through January, the steepest rise in 39 years.
* Gold is used as a hedge against inflation. Hence, higher inflation boosts demand for gold.
* At 1701 IST, the most-active contracts of bullion were:
–April gold was up 1.2% at 50,809 rupees per 10 gm on MCX
–April gold was up 1.1% at $1,908.4 an ounce on COMEX
–May silver was up 1.5% at 65,895 rupees per kg on MCX
–-May silver was up 1.8% at $24.44 an ounce on COMEX
* Outlook for the evening session:
–MCX gold seen at 49,920-50,800 rupees
–COMEX gold seen at $1,874-$1,922
–MCX silver seen at 63,660-66,200 rupees
–COMEX silver seen at $23.80-$25.10
End
US$1 = 75.27 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Avishek Dutta
Cogencis news is now Informist. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (11) 4220-1000
Send comments to [email protected]
© Informist Media Pvt. Ltd. 2022. All rights reserved.
Source: Cogencis
