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Informist, Friday, Mar. 7, 2025

By Sandeep Sinha

MUMBAI – Futures contracts of gold were flat on the Multi Commodity Exchange of India and COMEX ahead of the US non-farm payrolls data later Friday, which could influence market sentiment. Analysts polled by Dow Jones estimated the payrolls to rise to 170,000 in February from 143,000 in January. 

The yellow metal traded in a narrow band as traders were cautious of taking aggressive positions and preferred to sit on cash. "The high level of uncertainty remains an important factor that should keep gold in demand as a safe haven. The recent weakening of the US dollar may provide additional support," Barbara Lambrecht, commodity analyst at Commerzbank AG, said in a note to clients.

The positive sentiment was further supported by buying by the People's Bank of China, inflows in gold exchange-traded funds, and a weaker dollar. The Chinese central bank bought 4.97 tonnes in February, the fourth straight month of purchases.

The latest World Gold Council data showed that global gold ETFs saw inflows of 99.9 tonnes of the metal in February. As of Feb. 28, global ETFs held 3,353.3 tonnes of gold.

At 1805 IST, the dollar index, which measures the strength of the greenback against a basket of major currencies, was down 0.4% at 103.76 ahead of US Federal Reserve Chair Jerome Powell's speech later in the day. A weak greenback makes dollar-denominated commodities cheaper for those holding other currencies, thus improving demand for precious metals.

At 1805 IST, the most active April gold contract on the MCX was flat at INR 86,014 per 10 grams. The most active April gold contract on COMEX was steady at $2,927 per ounce. The highest call open interest was at INR 90,000 strike price, indicating a bullish view. The highest put open interest was at INR 85,000-INR 84,000 strikes for the Mar. 26 contract.

SILVER contracts fell, taking cues from COMEX and weak trend in industrial metals. At 1805 IST, the most-active May contract on the MCX was down 0.5% at INR 97,622 per kg. The same-month contract on COMEX was 0.8% lower at $33.06 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 Apr. 24 expiry contract.

The MCX Bulldex, an index that tracks the real-time performance of gold and silver futures on the MCX, was down just 9 points at 20527 points. The April and June gold contracts on the MCX recorded turnovers of INR 21.05 billion and INR 1.99 billion, respectively. The May and July silver contracts saw turnovers of INR 9.29 billion and INR 639.52 million, respectively.

The spot gold-silver ratio, also known as the Mint ratio, rose to 89.95 Friday, indicating that gold had outperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 89.60 Thursday.

Outlook for the rest of the session:

--MCX gold seen at INR 85,698–INR 86,530 per 10 gm

--COMEX gold seen at $2,899.63–$2,937.93 an ounce

--MCX silver seen at INR 97,272-INR 98,100 per kg

--COMEX silver seen at $32.92-$33.44 an ounce

End

US$1 = INR 86.87

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

Edited by Rajeev Pai

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