Mumbai: Indian gold futures were slightly up on Friday as overseas markets remained steady in the wake of this week’s interest rate cuts in the US, and analysts said it could aim higher during the day.
Lower interest rates in the US weaken the dollar, driving investors to gold, as the two compete for investors’ wealth.
“After the cut in U.S. rates, we are yet to see a surge in gold,” said Shailendra Kumar, head of research at Sharekhan Commodities Pvt Ltd. “The dollar is still weak, so more upside is likely for gold.”
Overseas spot gold was nearly flat at $925.80 an ounce, but remained close to its record high of $933.10 an ounce struck on Tuesday, suggesting it was getting support at higher levels.
If the April contract on the Multi Commodity Exchange of India Ltd crosses Rs11,800 per 10 grams, it could aim for Rs11,850 and Rs11,970, said Ravindra Chauhan, senior technical analyst at Anand Rathi Commodities.
“If it falls below Rs11,670, it may fall into a bearish phase,” Chauhan added. Open interest for the April contract on MCX was at 10,624 lots, up from 10,496 on the previous day. Volume on Thursday was at 40.59 kg.