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Gold gets cheaper: 5 key trigger points to move yellow metal this week

Sentiments in bullion will revolve around a host of factors right from crude oil prices to the US Fed chair's speech. (AFP)Premium
Sentiments in bullion will revolve around a host of factors right from crude oil prices to the US Fed chair's speech. (AFP)

  • In India, a 24 carat gold in 10 gram is priced at 50,450 down by 220 from the previous closing of 50,670. Meanwhile, a 100 gram gold in the same carat has gotten cheaper by 2,200 to 5,04,500 from the previous day's 5,06,700.

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Gold gets cheaper today! A 24-carat gold in 10 gram is priced at 50,450 on Saturday. The prices tracked a fall in futures amidst a strengthening of the dollar, depreciating Indian rupee, and higher treasury yields. This week, concerns of inflationary pressures, rising interest rates, and uncertainties in the Russia-Ukraine invasion to impact economic growth has led to money moving out of precious metals. However, the next week, sentiments in bullion will revolve around a host of factors right from crude oil prices to the US Fed chair's speech.

In India, a 24 carat gold in 10 gram is priced at 50,450 down by 220 from the previous closing of 50,670. Meanwhile, a 100 gram gold in the same carat has gotten cheaper by 2,200 to 5,04,500 from the previous day's 5,06,700.

Meanwhile, a 22 carat gold is available at 46,250 in 10 gram - down by 200 from the previous day's 46,450. Whereas a 100 gram gold in the same carat stands at 4,62,500 lower by 2000 from the previous day.

On the other hand, silver got costlier today with 1 kg gram of this metal priced at 59,400 up by 700 from the previous day. 10 gram and 100 gram silver is available at 594 and 5,940 higher from their previous day.

As per the PTI report, closing bullion rates on Saturday were - standard gold [99.5 purity] at 51,900 per 10 grams, Ornament gold at 4,840 per gram, and Silverspot [.999 fineness] at 61,400 per kg.

On Friday, at MCX, gold futures maturing June 3, dipped by 265 or 0.53% and closed at 49,909. Meanwhile, silver futures maturing June 5, surged by 631 or 1.07% and ended at 59,382.

For the next week, Sugandha Sachdeva, VP-Commodity & Currency Research at Religare Broking lists five key factors to move sentiments in bullion.

Sugandha said, "an array of factors will dictate price moves in gold for the coming week where the key catalyst would be the movement of the greenback. Firstly, any further strength in the US dollar would be negative for gold prices, while some softening of the same would lead to renewed buying interest in gold. Secondly, the trend in crude oil would impact inflation expectations and thereby gold prices. As for the third variable, markets would be keenly eyeing any further development in the Russia-Ukraine war."

For the fourth and fifth factors, Sugandha said, "The rupee-dollar exchange rate shall also remain on investors’ radar. Besides, the Fed Chair's speech and Retail Sales data from the US will provide further cues for gold prices."

On rupee, Anuj Gupta, Vice President — Research at IIFL Securities said, "Indian national Rupee (INR) hit it as new record low last week and any bounce back in Indian rupee against the US dollar would lead to some rise in precious meta in domestic market. So, rupee versus dollar is going to work as domestic trigger for the yellow metal."

Gupta further said, "US retail sales data will have a direct impact on dollar index. If the data comes disappointing in that case profit-booking in US dollar may trigger leading to demand for gold in near term. Apart from this, lower US retail sales data will have a negative impact on US inflation, which may support gold price."

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