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Informist, Tuesday, Jan. 7, 2025

By Sandeep Sinha

MUMBAI – Futures contracts of gold rose on the Multi Commodity Exchange of India and the COMEX on Tuesday as the dollar weakened ahead of the US jobs data later in the day. A weaker greenback makes dollar-denominated precious commodities cheaper for those holding other currencies, thus improving demand.

At 1750 IST, the Dollar Index, which measures the strength of the greenback against a basket of major currencies, was down 0.2% at 108.06. Investors will also take cues from US job openings and labor turnover survey and Institute for Supply Management's services purchasing managers' index, to be released later Tuesday.

"Gold is seen consolidating in a range but is likely to trade with a positive bias on safe-haven buying, as the US dollar index dips close to 108-level, while the focus now remains in the US employment data due later in the week and also on Donald Trump's second term as US President," Pranav Mer, vice-president-research, commodity and currency at JM Financial, said in a note.

At 1755 IST, the most-active February GOLD contract on the MCX was up 0.3% at INR 77,411 per 10 grams. The most-active February contract on the COMEX was 0.5% higher at $2,659.80 per ounce. The highest call open interest for gold was at INR 78,000-INR 80,000 strike prices, suggesting a bullish view. The highest put open interest was at the INR 75,000-INR 74,000 strikes for the Jan. 27 contract.

On Monday, gold holdings with SPDR Gold Trust, the world's largest gold-backed ETF, remained steady at 871.08 tonnes. The fund has a market value of $73.72 billion. On the National Stock Exchange, the total value of gold ETFs traded on Tuesday was INR 1.33 billion, up from INR 1.13 billion on Monday.

SILVER contracts traded higher taking cues from COMEX and from gold. At 1800 IST, the most-active March contract on the MCX was up 0.7% at INR 91,178 per kg. The same-month contract on the COMEX was 0.8% higher at $30.83 per ounce. On the options front, the highest call open interest was at the INR 100,000 strike price. The highest put open interest was at INR 90,000 strike for the Feb. 24 expiry contract.

The MCX Bulldex, an index that tracks the real-time performance of gold and silver futures on the MCX, was up 76 points at 18882 points. Until 1800 IST, the February and April gold contracts recorded turnovers of INR 26.15 billion and INR 7.71 billion, respectively. The March and May silver contracts saw turnovers of INR 13.14 billion and INR 1.26 billion, respectively.

The spot gold-silver ratio, also known as the Mint ratio, rose to 87.63 on Tuesday, indicating that gold had outperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 87.36 on Monday.

Outlook for the rest of the session:

--MCX gold seen at INR 76,640–INR 78,040 per 10 gm

--COMEX gold seen at $2,626.27–$2,665.67 an ounce

--MCX silver seen at INR 90,260-INR 93,000 per kg

--COMEX silver seen at $30.44-$31.00 an ounce

End

US$1 = INR 85.71

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

Edited by Ashish Shirke

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