Gold prices today fall for second day, down ₹2,100 per 10 gram in 2 months2 min read . Updated: 18 Nov 2019, 06:17 PM IST
- Optimism over US-China trade deal has put pressure on gold rates
- Silver prices have also fallen sharply, tracking gold
Gold prices today fell in India, extending losses to the second day. On MCX, December futures contract fell 0.41% to ₹37,838. After the latest decline, gold prices are now down about ₹2,100 per 10 gram from their September highs of about ₹40,000 per 10 gram. Silver prices also fell sharply today. Silver contracts on MCX were down about 1% to ₹44,040. In global markets, gold prices were flat today amid optimism that US and China could reach a mini deal on trade spat. Spot gold rates were at $1,467 per ounce. Losses were however capped by a softer dollar.
"Optimism over US-China trade deal eased apprehensions of a further economic slowdown and boosted the market optimism. Increased global economic confidence may reduce gold’s safe haven demand and influence the price of yellow metal. However, growing geopolitical tensions likely to offer lower level support to prices. A weaker could however protect from major selling pressure in domestic gold prices," said Hareesh V, head of commodity research at Geojit Financial Services.
On MCX gold December contracts, Mr Hareesh of Geojit Financial Services, said: "A move above ₹38,350 would negate the mild bearish outlook and take prices higher till ₹38,440 or even more."
On the other hand, if the support of ₹37,860 is broken, there could be more downside, he said.
China's Vice Premier Liu He, US trade representative Robert Lighthizer and Treasury Secretary Steven Mnuchin had constructive talks on trade in a high-level phone call over the weekend, state media Xinhua reported.
In global markets, silver prices were down 0.2% at $16.91 per ounce.
China's central bank in a surprise move today trimmed a closely watched lending rate, the first such cut in more than four years, boosting the risk appetite. This put pressure on gold prices.
Gold is considered a safe store of value during times of economic or political uncertainty.
China's economic growth has eased to its slowest in nearly three decades and recent data such as credit growth and industrial output have continued to show a cooling economy.
On the other hand, gold investors also kept a close eye on developments in Hong Kong, which has been rocked by protests for months now. Also, on their radar will be minutes of the Federal Reserve's last policy meeting, due on Wednesday, for clues about the future interest rate trajectory.
Gold is sensitive to interest rates, as a lower interest reduces the opportunity cost of holding the non-yielding bullion. (With Agency Inputs)