New Delhi: Gold and silver prices edged down in Indian markets today after posting strong gains in the previous session. On MCX, October gold futures fell 0.22% to ₹51 665 for 10 grams. Silver futures fell 1% to ₹66,821 per kg. In the previous session, gold had rebounded, ending a five-day losing streak. Gold futures surged ₹900 per 10 grams when the money had jumped ₹3500 per kg.
In global markets, gold prices were flat after posting strong gains in the previous session. Spot gold was flat at $ 1,952.11 an ounce, supported by a weaker US dollar. Among other precious metals, silver fell 0.8% to $ 27.30 an ounce, platinum rose 0.6% to $ 934.29.
The dollar index fell 0.2% to an almost a week low against its rivals, making gold cheaper for holders of other currencies. Gold traders are awaiting a speech from Federal Reserve Chairman Jerome Powell scheduled for later today for more information on the U.S. central bank’s strategy on inflation and monetary policy. The bank provided crucial multibillion-dollar support to the world‘s largest economy during the virus crisis, helping stocks rebound from their March lows.
Meanwhile, the holdings of SPDR Gold Trust, the world‘s largest exchange-traded fund or gold-backed ETF, said their holdings rose 0.3% to 1,252.09 tonnes on Wednesday.
Further supporting gold prices, geopolitical concerns returned after Beijing fired missiles into the South China Sea and the United States sanctioned several Chinese companies linked to the disputed region.
Meanwhile, reports indicate that Republicans in the US Congress are working on a narrow coronavirus stimulus bill that could be distributed to lawmakers as early as this week. Gold tends to benefit from widespread central bank stimulus as it is widely viewed as a hedge against inflation and currency degradation.
However, declining consumer demand is weighing on the price of gold, as shown by rebates in the Indian and Chinese markets, according to Kotak Securities. “Gold may continue to witness volatile trade unless we get more clarity on the Fed’s position and, therefore, the trend of the US dollar, but we might see interest in the US dollar.
purchase emerge at lower levels amid lingering viral fears, growth fears and differences between the United States and China on various issues,”the brokerage added.
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