In view of the strong global cues, gold in the Indian markets rose to a nine-month high today. Gold futures up 0.9% on MCX 49,292 per 10 grams while silver jumped 1% 66,570 per kg. In global markets, gold rose 0.6% to $1,860.59 an ounce after hot US inflation numbers pushed investors to the safety of the precious metal.
Amit Khare, AVP – Research Commodities, Ganganagar Commodity: “Hot inflation numbers from the US and China fueled buying interest in the precious metals markets today, as traders and investors seek hard-asset hedges against rising prices. Huh.”
Analysts say gold, seen as a hedge against inflation, will have good support as long as inflationary fears dominate sentiment. Data released Wednesday showed US consumer prices rose at the fastest pace in 31 years in October.
Manoj Dalmiya, Founder and Director, Profitable Equities Ltd. said, although gold’s rally was fueled by unexpectedly large inflation numbers in the US and rising interest rate concerns, it was still in line with an intermediate uptrend.
,Sleep was indeed consolidating after crossing the August high of 47900 and its primary downtrend clearly ended. From a season perspective also, gold is entering a bullish phase as the months of December and January are traditionally bullish.”
The metal strengthened despite the dollar hitting a 15-month high, making gold more expensive for holders of other currencies. Lower incentives and higher interest rates boost government bond yields, increasing the opportunity cost of gold, which pays no interest.
Recent gains in bullion have been supported by a softer tone taken by major central banks last week, with the Federal Reserve reiterating its view that inflation was “temporary” and would likely not require a rapid increase in rates.
However, this week several Fed officials expressed growing concern over more prolonged inflation.
Among other metals, spot silver rose 1.2% to $24.91 an ounce. Platinum rose 1.4% to $1,082.00 an ounce, and palladium rose 1.5% to $2,050.23.
Amit Khare, AVP – Research Commodities, Ganganagar Commodity Limited, however, said that investors use buy-on-dip strategy to enter gold. “Both Gold and Silver are rising continuously since last few trading sessions, at current prices both metals look risky for fresh buying as per technical chart, Momentum Indicator RSI is also giving similar signal on daily chart, so traders should After some time should wait for fresh purchase. Improvement.” (with agency input)
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