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Informist, Thursday, Nov. 7, 2024

By Ashutosh Pati

MUMBAI – Futures contracts of gold and silver rose on the Multi Commodity Exchange of India, tracking those on COMEX, Thursday because of a weak dollar, which makes commodities priced in the greenback cheaper for holders of other currencies. The sentiment was also lifted as the rupee touched a lifetime low of 84.3775 against the dollar.

At 1930 IST, the dollar index, which measures the strength of the greenback against a basket of six major currencies, was down 0.6% at 104.53.

GOLD prices fell around 2.7% in the previous session as Republican candidate Donald Trump won the US presidential election, which led to a sharp rally in the dollar. However, analysts at ANZ Research believe Trump's presidency will be bullish for gold owing to inflationary tariffs and a strained relationship with China.

For further cues, investors now await the US Federal Open Market Committee's monetary policy meeting outcome later in the day. According to the CME Fedwatch tool, 98.9% of market participants expect the US Federal Reserve to cut interest rates by 25 basis points. Lower interest rates reduce the opportunity cost of holding the non-yielding precious metal.

At 1930 IST, the most-active December gold contract on the MCX was up 0.6% at INR 77,090 per 10 gram. The most-active December contract on COMEX was up 0.5% at $2,690 per ounce.

The most-active December contract of SILVER on the MCX was up 1.1% at INR 91,802 per kg. The same-month contract on COMEX was up 1.2% at $31.72 per ounce.

The spot gold-silver ratio, also known as the Mint ratio, rose to 85.2, indicating that gold had outperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 84.81 on Wednesday.

Outlook for the rest of the session:

--MCX gold seen at INR 76,200–77,100 per 10 gm

--COMEX gold seen at $2,660.0–$2,700.0 an oz

--MCX silver seen at INR 89,400-92,300 per kg

--COMEX silver seen at $31.20-$32.30 an oz

End

US$1 = INR 84.37

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Rajeev Pai

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