NEW DELHI: Gold prices were trading flat, held in a tight range on Thursday. Investors awaited U.S. inflation data that could offer fresh clues about the pace of the Federal Reserve’s monetary policy tightening.
Russia has increased military capabilities along its border with Ukraine and in Belarus, according to the Pentagon. Ukraine believes there is still a chance of resolving the West’s standoff with Russia through diplomacy.
Gold futures on MCX were marginally lower by 0.01 per cent or Rs 5 at Rs 48,655 per 10 grams. Silver futures were trading lower by 0.09 per cent or Rs 59 at Rs 62,629 per kg.
Gold is considered a hedge against inflation and geopolitical risks, yet rate hikes would raise the opportunity cost of holding non-yielding bullion.
Ravindra Rao, CMT, EPAT, VP- Head Commodity Research, Kotak Securities said that retreat in US and global bond yields from recent highs, geopolitical tensions and inflation concerns supported the yellow metal prices.
“ETF investors have also moved to side-lines after recent inflows. Gold has continued to rise indicating buying interest however it may halt as US inflation data today may add to expectations that Fed may act soon,” he added.
In the spot market, the highest purity gold was sold at Rs 48,665 per 10 grams while silver was priced at Rs 62,387 per kg on Wednesday, according to the Indian Bullion and Jewellers Association.
The spot prices of gold have jumped about Rs 850 per 10 grams in less than 10 sessions, whereas Silver has risen more than Rs 1650 per kg in the last one week.
“Gold prices may continue to follow a bull run for some trading sessions. The US inflation data due today will be decisive for the next move of gold, probably on a higher side,” said Ravi Singh, Vice President and Head of Research, ShareIndia.
Trading strategy
“We expect gold prices to trade sideways to up for the day with COMEX Spot gold support at $1,820 and resistance at $1,850 per ounce. MCX Gold April futures support lies at Rs 48,300 and resistance at Rs 49,000 per 10 gram,” Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
Global markets
Spot gold was steady at $1,833.26 per ounce by 0113 GMT, hovering close to Wednesday’s high of $1,835.60. US gold futures fell 0.1 per cent to $1,834.30.
Silver fell 0.3 per cent to $23.23 per ounce, platinum was also down 0.3 per cent to $1,030.92, while palladium was steady at $2,279.51.