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Informist, Thursday, Feb. 13, 2025

By Sandeep Sinha

MUMBAI – Futures contracts of gold rose on the Multi Commodity Exchange of India, tracking rise in contracts on the COMEX as investors sought the safety of the precious metal because of global economic uncertainty. The sentiment for precious metals was lifted further by a weaker dollar.

The Dollar Index, which measures the strength of the greenback against a basket of major currencies, was down 0.2% at 107.75 at 1740 IST. A weaker greenback makes dollar-denominated commodities cheaper for those holding other currencies, thus improving demand for precious metals.

"Gold prices are likely to trade higher as markets closely tracked developments in US President Donald Trump's tariff plans, which could ignite a global trade war, while investors awaited crucial US data due later in the day," Prathamesh Mallya, deputy vice president research, non-agro commodities and currency at Angel One, said.

At 1740 IST, the most-active April GOLD contract on the MCX was up 0.6% at INR 86,002 per 10 grams. The most-active April gold contract on COMEX was up 0.7% at $2,948.40 per ounce. The highest call open interest was at INR 85,000-INR 86,000 strike prices, indicating a bullish view. The highest put open interest was at INR 82,000-INR 80,000 strikes for the Feb. 28 contract.

However, outflow from gold exchange-traded funds limited the upside in gold prices. On Wednesday, gold holdings with the SPDR Gold Trust, the world's largest gold-backed ETF, fell by 5.44 tonnes to 866.50 tonnes. The fund has a market value of $80.54 billion. On the National Stock Exchange, the total value of gold ETFs traded on Thursday was INR 2.30 billion, down from INR 2.27 billion on Wednesday.

For further cues, investors will now shift their focus to data on the US producer price index and initial jobless claims later in the day. Analysts polled by Dow Jones see the jobless claim at 215,000, down by 4,000 from last week.

SILVER contracts were marginally higher, taking cues from COMEX and a firm trend in gold. At 1750 IST, the most-active March contract on the MCX was up 0.1% at INR 95,582 per kilogram. The same-month contract on the COMEX was up 0.1% at $32.80 per ounce. On the options front, the highest call open interest was at the INR 95,000-INR 100,000 strike prices. 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 56 points at 20446 points. The April and June gold contracts on the MCX recorded turnovers of INR 26.49 billion and INR 1.24 billion, respectively. The March and May silver contracts saw turnover of INR 11.02 billion and INR 2.73 billion, respectively.

The spot gold-silver ratio, also known as the Mint ratio, fell to 90.55 on Thursday, indicating that gold underperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 90.67 on Wednesday.

Outlook for the rest of the session:

--MCX gold seen at INR 85,428–INR 86,431 per 10 gm

--COMEX gold seen at $2,898.17–$2,967.33 an ounce

--MCX silver seen at INR 95,080-INR 96,240 per kg

--COMEX silver seen at $32.10-$33.10 an ounce

End

US$1 = INR 86.89

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

Edited by Ashish Shirke

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