Gold prices rise today but still down ₹2,000 in 2 months. Silver rates surge1 min read . Updated: 29 Jul 2021, 02:27 PM IST
- Analysts say gold prices are being supported by monetary policy uncertainty, and inflation risks at lower levels
Gold prices in India edged higher today, tracking positive global cues. On MCX, August gold futures were up 0.6% to ₹47,893 per 10 gram while silver futures surged nearly 2% or ₹1,250 to ₹67622 per kg. Gold rates are still down ₹2,000 from June highs amid subdued demand.
In global markets, gold rates rose for third day in a row, boosted by Federal Reserve Chairman Jerome Powell's dovish tone. Spot gold rose 0.6% to $1,818.50 per ounce. Among other precious metals, silver gained 1.6% at $25.33 per ounce while platinum rose 1% to $1,075.29.
Overnight, the Fed reiterated that a recent surge in inflation is likely transitory. Treasury yields were steady while the dollar index slipped 0.3%. Fed chairman Jerome Powell said there was still some way to go to meet the conditions for tapering.
Lower interest rates reduce the opportunity cost of holding non-yielding bullion while a weaker greenback makes gold cheaper for holders of other currencies. Gold traders will now now turn their attention to the US weekly jobless claims data due later today.
Analysts say gold prices are being supported by monetary policy uncertainty, and inflation risks.
Spot gold were boosted after US Federal Reserve failed to give a timeframe for tapering of economic stimulus activities, said Hareesh V, Research Head Commodities at Geojit Financial Services.
"The policy statement weighed on the US dollar, which made gold cheaper for holders of other currencies. Worries over the rise in new virus cases also lent support the commodity."
Technical outlook for gold
"If the support of $1800 remains, there are chances of recovery upticks towards $1845 followed by $1880 levels. However, an unexpected drop below $1765 is an early signal of liquidation pressure," he said.
The World Gold Council in a report said that in the June quarter gold demand (excluding OTC) was virtually flat as compared to the year-earlier quarter. On a half yearly basis, gold demand was down 10% year on year.
"Q2 jewellery demand (390.7t) continued to rebound from 2020’s COVID-hit weakness, although remained well below typical pre-pandemic levels, partly due to weaker Indian demand growth. Demand for H1, at 873.7t, was 17% below the 2015-2019 average," it said. (With Agency Inputs)
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