After a sharp fall in the previous session, gold prices remained weak in the Indian markets today. MCX gold futures fell 0.04% to near one-month low ₹46,878 while silver gained 0.28% ₹63,468 per kg. In the previous session, gold had fallen by 0.77% or almost ₹400 while silver was down 0.5%.
In global markets, gold prices were trading below the key $1,800 level as investors remained cautious ahead of the US Federal Reserve meeting next week. Spot gold fell 0.6% to $1,793.20 an ounce despite a weakening US dollar. The Fed’s two-day policy meeting is scheduled for September 21-22. Analysts expect the US central bank to begin scaling back its asset purchases and provide guidance on interest rate hikes.
“If the $1770 support remains in place, chances of recovery in gold are still on the cards. A direct decline below this would call for a corrective selloff,” domestic brokerage Geojit said in a note.
Earlier this week, gold rose to a one-week high following data from the US Consumer Price Index, but gave up most of its gains as US Treasury yields rose higher.
ETF inflows remained weak. Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.2% to 998.46 tonnes on Wednesday.
Among other precious metals, silver remained unchanged at $23.81 an ounce, while platinum remained steady at $947.39.
For silver, “there could be a slight positive bias as long as the price stays above $23.40. However, major rallies are seen only near $24.60,” Geojit said.
“While inflation concerns are rising, the pace of growth is slowing down. Adding to the challenges in the global economy are the risks of the virus, geopolitical tensions and China’s regulatory crackdown on large tech firms. The latest WHO report shows some stability in the virus situation globally, but some parts of China have seen a resurgence in cases,” Kotak Securities said in a report.
“Commodities may see choppy trade amid ongoing debate about Fed’s monetary policy. A slight easing in consumer prices eased market nerves about Fed tightening, but from next week’s meeting First the debate may continue.However, we expect the US dollar to remain under pressure and this may support the commodity prices.
(with agency input)
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