1 min read.Updated: 27 Dec 2021, 06:08 PM ISTLivemint
Gold rates may remain choppy amid lack of fresh triggers and holiday impacted trade, say analysts
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Gold rates edged lower in India today but losses were capped due as concerns over the Omicron coronavirus variant increased safe-haven demand. On MCX, gold futures were down 0.1% to ₹48,073 per 10 gram, extending losses to the third day while silver fell 0.8% to ₹61,805 per kg. In global markets, gold dipped slightly but remained above remained above the reached $1,800 last week.
The dollar index rose from its weakest level in nearly a week, making greenback-priced gold less attractive for holders of non-US currencies. Analysts say gold faces resistance near $1,810.
“COMEX gold trades little changed near $1800 after a 0.4% gain last week. Gold is stable as support from virus concerns, rising inflationary pressure and slowdown in China is countered by some recovery in US dollar index and stable equities. ETF flows also show weaker investor interest. Gold may remain choppy amid lack of fresh triggers and holiday impacted trade. However we may not see a sustained rise unless price breaks past the $1815/ounce and as Fed’s monetary tightening expectations lends support to the US dollar," said Ravindra Rao, Head Commodity Research of Kotak Securities.
Global equities were steady today but oil prices eased on concerns that the Omicron variant could slow the economy in the new year. Analysts say that risk sentiment has improved significantly in last few sessions as market players have countered rising virus cases and increasing virus related restrictions with early studies showing that the virus variant may not be as severe and booster shots of some existing vaccines may provide some protection.
Among other precious metals, silver retreated by 1% to $22.71 an ounce while platinum slid 1.5% to $960.00. Palladium eased by 0.3% to $1,943.45 after touching its highest since Nov. 23 at $1,962.50.
“Gold is yet to break past recent highs of $1815/oz. We do not expect a sustained rise in US dollar as stability in equity markets may reduce its safe haven appeal while Fed’s tightening outlook may keep a floor to US dollar," Kotak Securities said in a recent note. (With Agency Inputs)