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Informist, Tuesday, Jan. 28, 2025

By Ashutosh Pati

MUMBAI - Futures contracts of gold rose on the Multi Commodity Exchange of India Tuesday, tracking a rise in COMEX contracts. The focus of market participants shifted to the US Federal Reserve's interest rate decision, due Wednesday. Investors are also closely monitoring how the US President Donald Trump's policies will impact the Fed's views on growth and inflation, analysts said.

At 1812 IST, the most-active February GOLD contract on the MCX was up 0.4% at INR 79,915 per 10 grams. The most-active February contract on COMEX was 0.4% higher at $2,748 per ounce.

A weaker rupee against the dollar also supported gold prices. The rupee fell 0.2% against the dollar and closed at 86.52 due to rising bets of an interest rate cut by the Reserve Bank of India's Monetary Policy Committee next week. 
 

"...we anticipate that bullion prices will remain volatile this week due to the FOMC (Federal Open Market Committee) meeting, as well as the release of advance GDP data, consumer confidence reports, and jobless claims data, which may contribute to fluctuations in the yellow metal's prices," Deveya Gaglani, senior research analyst commodities at Axis Securities said in a note.

However, any further upside in gold prices was capped by a firm dollar. At 1813 IST, the dollar index, which measures the strength of the greenback against a basket of six major currencies, was up 0.5% at 107.97. A stronger greenback makes dollar-denominated precious metals expensive for buyers holding other currencies, denting demand.

Silver contracts traded higher taking cues from COMEX and from gold. At 1814 IST, the most-active March contract on the MCX was up 0.2% at INR 90,420 per kg. The same-month contract on the COMEX was 0.3% higher at $30.51 per ounce.

Outlook for the rest of the session:

--MCX gold seen at INR 79,106–INR 80,604 per 10 gm

--COMEX gold seen at $2,738–$2,796 an ounce

--MCX silver seen at INR 88,337-INR 92,333 per kg

--COMEX silver seen at $30.28-$31.17 an ounce

End

US$1 = INR 86.52

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

Edited by Vandana Hingorani 

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