Gold prices in India drop for second day on China jitters, silver rate plunges
1 min read 28 Nov 2022, 12:11 PM ISTGold traders will be looking ahead to US Labor Department's nonfarm payrolls data due later this week
PremiumGold prices in India dipped today while silver plunged, tracking a similar global trend as covid protests in China dampened global risk sentiment. Gold futures on MCX fell 0.25% to ₹52,420 per 10 gram, extending losses to the second day. Silver fell 0.8% to ₹61,185 per kg. Other commodities including metals and crude dropped today as unrest in China dampened demand outlook.
In global markets, spot gold was down 0.4% at $1,749.00 per ounce. Among other precious metals, silver slipped 1.8% to $21.21, platinum fell 0.3% to $978.00 and palladium declined 0.3% to $1,846.94. Amid the global risk-off sentiment, the dollar index was up 0.4%, making the greenback-priced bullion more expensive for buyers holding other currencies.
Protests in China have dampened global risk sentiment, according to analysts. “Risk off moves are seen across asset classes this Monday morning in Asia session. The dollar has strengthened across the board, especially against commodity currencies," IFA Global said in a note.
Gold traders will be looking ahead to US Labor Department's nonfarm payrolls data due later this week to get a further clues on Fed's monetary policy. Federal Reserve Chair Jerome Powell's is also due to speak on US economy later this week. A majority of market participants are pricing in a 50 basis-point increase at the Fed's December meeting after minutes of the last policy meeting signalled a slower pace of hikes. Higher interest rates increase the opportunity cost of holding the non-yielding metal.
“Gold and silver prices had gained last week post dovish remarks from the U.S. Fed officials in the November month meeting minutes. The US Fed officials signalled the slow pace of interest rate hikes going ahead, which pushed the dollar index and the U.S. bond yields lower and supported precious metal prices. Gold and silver also gained due to geo-political tensions and mixed economic data released last week," said Rahul Kalantri, VP Commodities, Mehta Equities Ltd.
“We expect gold and silver to remain volatile this week ahead of the U.S. quarterly GDP data and ADP non-farm employment data. Gold has support at $1734-1720 while resistance is at $1755-1764. Silver has support at $20.88-20.65, while resistance is at $21.42-22.58. In rupee terms gold has support at ₹52,420-52,250, while resistance is at ₹52,680, 52,820. Silver has support at ₹61,250-60,680, while resistance is at ₹62,100–62,340," he added. (With Agency Inputs)
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