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Informist, Wednesday, Jan. 8, 2025

By Sandeep Sinha

MUMBAI – Futures contracts of gold rose on the Multi Commodity Exchange of India because of weakness in the rupee against the dollar and on the back of positive cues from COMEX. Investors were also cautious ahead of the US Federal Open Market Committee's December meeting minutes to be released early Thursday.

The rupee fell 0.2% against the dollar and closed at a new lifetime low of 85.85 because of selling by foreign funds and importers' purchase of the greenback. A weaker domestic currency makes dollar-denominated commodities expensive for domestic buyers.

At 1552 IST, the most-active February GOLD contract on the MCX was up 0.2% at INR 77,660 per 10 grams. The most-active February contract on the COMEX was 0.1% higher at $2,667.40 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 Tuesday, gold holdings with SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, remained steady for the second day at 871.08 tonnes. The fund has a market value of $74.21 billion. On the National Stock Exchange, the total value of gold ETFs traded on Wednesday was INR 979.0 million, down from INR 1.33 billion on Tuesday.

SILVER contracts traded higher, taking cues from COMEX and from gold. At 1550 IST, the most-active March contract on the MCX was up 0.4% at INR 91,245 per kg. The same-month contract on the COMEX was 0.4% higher at $30.79 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 91 points at 18965 points. Until 1555 IST, the February and April gold contracts recorded turnovers of INR 15.13 billion and INR 2.88 billion, respectively. The March and May silver contracts saw turnovers of INR 9.23 billion and INR 1.26 billion, respectively.

The spot gold-silver ratio, also known as the Mint ratio, rose to 87.79 on Wednesday, indicating that gold had outperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was at 87.49 on Tuesday.

Outlook for the rest of the session:

--MCX gold seen at INR 77,150–INR 77,880 per 10 gm

--COMEX gold seen at $2,644.90–$2,679.90 an ounce

--MCX silver seen at INR 90,970-INR 92,200 per kg

--COMEX silver seen at $30.67-$31.05 an ounce

End

US$1 = INR 85.85

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

Edited by Tanima Banerjee

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