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Informist, Friday, Apr. 4, 2025

By Sandeep Sinha

MUMBAI – Futures contracts of gold fell on the Multi Commodity Exchange of India and the COMEX on Friday as higher-than-expected US non-farm payroll data dashed hopes of an early rate cut by the US Federal Reserve. Sentiment for the precious metal was further hurt by profit-taking and recovery in the dollar, which makes precious commodities priced in the greenback expensive for holders of other currencies, dulling the demand for bullion.

"Profit-taking and the anticipation of potential tariff reductions by trading partners contributed to the downward pressure," Kotak Securities said in a note. The rout in global equity markets and other asset classes forced traders to liquidate their gold positions in order to provide margin calls.

At 1845 IST, the dollar index, which measures the strength of the greenback against a basket of major currencies, was up 0.3% at 102.22.

The US non-farm payroll data for March showed that the country added 228,000 jobs, higher than February and above analysts' expectations of 140,000 job additions. This indicates that the world's largest economy is still quite resilient, which weighed on sentiment.

At 1845 IST, the most-active June GOLD contract on the MCX was down 0.7% at INR 89,410 per 10 grams. The most-active June gold contract on the COMEX was down 0.7% at $3,099.10 per ounce. The highest call open interest was at INR 91,000 strike price, indicating a bullish view. The highest put open interest was at INR 88,000-INR 85,000 strikes for the Apr. 30 contract.

However, the fall in the yellow metal was cushioned by inflows in gold exchange-traded funds. On Thursday, gold holdings with SPDR Gold Trust, the world's largest gold-backed ETF, rose by 4.3 tonnes to 936.24 tonnes. The fund has a market value of $93.83 billion. On the National Stock Exchange, the total value of gold ETFs traded on Friday was INR 3.81 billion.

SILVER contracts edged lower taking cues from the COMEX due to sell-off in industrial metals and concerns about demand. At 1850 IST, the most-active May contract on the MCX was down 3.4% at INR 91,149 per kg. The same-month contract on the COMEX was 3.5% lower at $30.84 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 95,000 strike for the Apr. 24 expiry contract.

The spot gold-silver ratio, also known as the Mint ratio, rose to the highest level since July 2020 to 100.42 on Friday, indicating that gold had outperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 97.75 on Thursday.

Outlook for the rest of the session:

--MCX gold seen at INR 89,070–INR 89,890 per 10 gm

--COMEX gold seen at $3,080.0–$3,115.0 an ounce

--MCX silver seen at INR 89,200-INR 91,800 per kg

--COMEX silver seen at $30.75-$31.80 an ounce

End

US$1 = INR 85.23

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

Edited by Ashish Shirke

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