NEW DELHI: Gold prices traded firm on Monday, recouping some losses after a steep sell-off in the previous session. US bond yields and the dollar softened, restoring some of the precious metal’s appeal.
Gold futures on MCX were trading up 0.18 per cent, or Rs 86, at Rs 47,299 per 10 gram. Similarly, silver futures were up 0.29 per cent, or Rs 181, at Rs 63,452 per kg.
The yellow metal is up following weak China GDP data despite a firm dollar and higher bond yields. Gold prices are also getting support from inflation worries which may hurt economic recovery.
Gold is often considered an inflation hedge, though reduced stimulus and interest rate hikes push government bond yields up, raising the opportunity cost of holding non-yielding bullion.
Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities, said gold prices are supported by disappointing Chinese economic data, persisting inflation concerns and retreat in US dollar index and US bond yields from recent highs.
“However, stability in equity markets amid upbeat US economic data, corporate earnings results and continuing ETF outflows is weighing on the bullion,” he added.
According to data from the commerce ministry, gold imports increased to about $24 billion during April-September 2021 from $6.8 billion in the previous year, ahead of the busy festive season.
In the spot market, highest purity gold was sold at Rs 48,125 per 10 gram while silver was priced at Rs 63,290 per kg, according to the Indian Bullion and Jewellers Association.
The spot price of the yellow metal has gained about Rs 1,700 per 10 gram in the last two weeks, whereas silver is up more than Rs 3,700 per kg during the period under review.
“We expect gold prices to trade sideways to up for the day with COMEX gold support at $1,750 and resistance at $1,800 per ounce. MCX Gold December support lies at Rs 46,900 and resistance at Rs 47,500 per 10 gram,” Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
Spot gold rose 0.2% to $1,770.26 per ounce by 202 GMT, after slipping 1.6% on Friday. US gold futures were up 0.1% at $1,770.50.
Spot silver rose 0.2% to $23.34 per ounce, while platinum eased 0.4% to $1,050.80 and palladium fell 0.7% to $2,059.18.