Gold prices today rise after 3-day fall, still down ₹9000 from record highs2 min read . Updated: 16 Feb 2021, 09:21 AM IST
- Higher US bond yields have weighed on gold in recent days
- Analysts expect gold to trade sideways in the short term
Gold prices today edged higher after a 3-day fall but struggled to push significantly higher amid flat global rates. On MCX, gold futures rose 0.3% to ₹47,389 per 10 gram while silver rose 0.7% to ₹70,621 per kg. In previous three sessions, gold had declined ₹800 amid softer global rates. In global markets, spot gold prices were flat today as US Treasury yields rose to their highest levels since March. Higher bond yields increase the opportunity cost of holding non-yielding assets like gold.
However, a weaker US dollar supported the precious metal. Spot gold edged up 0.1% to $1,820.71 per ounce. The dollar index, which represents the value of the greenback against a basket of six currencies, slipped 0.26% to 90.237.
"We expect gold prices to trade sideways to down for short term with COMEX spot gold having resistance near $1,860 per ounce and support at $1,760 per ounce. At MCX, Gold April prices have near term resistance at Rs. 47800 per 10 grams and support at Rs. 46600 per 10 gram," HDFC Securities said in a Feb 15 note.
"Gold ETF holdings continued to witness outflows as holdings at SPDR Gold Shares fell to 1142 tonnes during the week from previous week’s 1156 tonnes," it added.
On the vaccine front, the World Health Organization on Monday approved Oxford University's COVID-19 vaccine for emergency use.
Meanwhile, platinum prices rallied to hit a near six-and-a-half-year high with investors betting that a global economic rebound would boost demand for the auto-catalyst metal. Platinum rose 1% to $1,315.32. Platinum is used by automakers for catalytic converter manufacturing to clean car exhaust fumes.
Asian equity markets were mostly higher today on optimism that US President Joe Biden will be able to soon sign off on a vast US stimulus package. Vaccine rollouts, slowing infections and the easing of lockdowns in some parts of the world also supported the risk-on sentiment. US markets were closed for Presidents’ Day on Monday and Chinese markets remain shut for the Lunar New Year holiday. Oil prices remained at over one-year highs.
"Commodities in international market trade largely higher supported by weakness in US dollar and improvement in risk sentiment. Market sentiment remains supported by hopes of additional US stimulus measures as well as improvement in virus situation," Kotak Securities said in a note.
In India, gold prices are down about ₹9,000 from August highs. Analysts say that economic recovery and a correction in prices will aid physical retail gold buying this year.
(With Agency Inputs)