Informist, Tuesday, Jun 28, 2022
By Chinmay Mungse
MUMBAI – GOLD contracts rose on the Multi Commodity Exchange of India today, supported by a weaker rupee against the US dollar. A weaker rupee makes dollar-denominated commodities more expensive for Indian investors.
* Benchmark GOLD contracts were flat on the COMEX today as supply fears triggered by the Group of Seven countries’ decision to ban Russia’s gold imports were offset by an upbeat US durable and core durable goods data.
* The US core durable goods orders in May showed a growth of 0.7% against an expected growth of 0.4% and durable goods orders also grew 0.7% against an expected growth of 0.1%. “Upbeat US data triggered profit-taking in precious metals, putting pressure on gold prices,” said Manoj Jain, research head at Prithvi Finmart.
* On Sunday, US President Joe Biden announced that the US, UK, Japan and Canada would impose a ban on the import of Russian gold to tighten sanctions on Moscow. The ban on Russia’s gold imports is expected to create a supply bottleneck which might support gold prices in the short term, analysts said.
* Investors are now watching closely for the US Federal Reserve Chair Jerome Powell and Bank of England Governor Andrew Bailey’s speeches at the European Central Bank’s annual forum in Sintra, Portugal.
* ECB President Christine Lagarde in her speech today said, “if the inflation outlook does not improve, we will have sufficient information to move faster. This commitment is, however, data-dependent.”
* Powell’s commentary at the ECB forum on Wednesday will also be keenly observed by investors and market participants. “We can expect some more hints over US Fed’s stance where he may emphasise on the need to adopt more rate hikes to control inflation,” said Tapan Patel, a senior analyst at HDFC Securities.
* At 1622 IST, the most-active contracts of bullion were:
–August gold was up 0.3% at 50,816 rupees per 10 gm on MCX
–August gold was flat at $1,825.6 an ounce on COMEX
–July SILVER was up 0.7% at 60,364 rupees per kg on MCX
–-July silver was up 0.4% at $21.26 an ounce on COMEX
* Outlook for the evening session:
–MCX gold seen at 50,700-51,000 rupees,
–COMEX gold seen at $1,820-$1,835
–MCX silver seen at 60,000-61,000 rupees
–COMEX silver seen at $21.20-$21.40
End
US$1 = 78.77 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Vidhi Verma
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