Mumbai, 19 September Indian gold futures were up today after the US made a bigger-than-expected cut in its interest rates and analysts said it seemed set to climb higher.
“With the interest rate cut the dollar doesn’t look attractive any more,” said Shailendra Kumar, head of research at Sharekhan Commodities Pvt. Ltd. “Money will flow into stocks, and the second thing is -- gold.”
Kumar said he expected October gold on the Multi Commodity Exchange of India Ltd. (MCX) to aim for Rs9,450 per 10 grams. “Gold won’t add much to current levels as people would like to take a breather,” Kumar added.
International gold rallied to a 16-month high after the US dollar tumbled in reaction to the Federal Reserve’s surprise rate cut by 50 basis points in the wake of credit and housing market troubles.
In the local market, the rupee strengthened against the dollar and helped cap some of the overseas gains in gold.
Another analyst at IL&FS Investsmart Commodities Ltd. had a similar view, though he expected even higher gains in October gold to around 9,480 rupees.
Open interest for October contract on MCX was at 9,607 lots, up from 9,574 on Tuesday. Volume the previous day was at 26.765 kg.
Following are gold prices in rupees per 10 grams on the Multi Commodity Exchange of India Ltd. at 11:10 a.m. <0#MAU:>:
Contract Current price Net change
Oct 9,441 67
Dec 9,549 67
For a technical look at international spot gold double click (www.reutersindia.net/gold.htm) REUTERS