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Informist, Tuesday, Apr. 8, 2025

By Sandeep Sinha

MUMBAI – Futures contracts of gold on the Multi Commodity Exchange of India and the COMEX rose because of short-covering after three days of a fall. Sentiment towards the metal was also lifted by weakness in the dollar, which makes precious commodities priced in the greenback cheaper for holders of other currencies.

A combination of heightened global economic tensions, risk of stagflation, a weaker dollar, and falling US real yields as inflation expectations rise, will continue to support gold, and to a certain extent silver, Ole Hansen, head of commodity strategy at Saxo Bank, said in a note to clients.

At 1840 IST, the dollar index, which measures the strength of the greenback against a basket of six major currencies, was down 0.5% at 102.96 on lower safe-haven demand. Investors will take further cues from minutes of the US Federal Open Market Committee's March meeting, to be released on Wednesday.

At 1840 IST, the most-active June GOLD contract on the MCX was up 1.4% at INR 88,100 per 10 grams. The most-active June gold contract on the COMEX was 1.7% higher at $3,024.20 per ounce. The highest call open interest was at the INR 90,000 strike price, indicating a bullish view. The highest put open interest was at the INR 87,000 strike for the Apr. 30 contract.

However, the upside was restricted due to continued outflow from gold exchange-traded funds. On Monday, gold holdings with SPDR Gold Trust, the world's largest gold-backed ETF, fell by 6.02 tonnes to 926.78 tonnes, the third straight day of a decline. The fund has a market value of $89.79 billion. On the National Stock Exchange, the total value of gold ETFs traded on Tuesday was INR 2.48 billion, down from INR 7.63 billion on Monday.

SILVER contracts traded higher, taking cues from COMEX, and firm trends in gold and industrial metals. At 1850 IST, the most-active May contract on the MCX was up 2.2% at INR 90,209 per kg. The same-month contract on the COMEX was 2.9% higher at $30.45 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 the 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 up 210 points at 20330 points. The June and August gold contracts on the MCX recorded turnovers of INR 67.04 billion and INR 5.08 billion, respectively. The May and July silver contracts saw turnovers of INR 28.30 billion and INR 3.21 billion, respectively.

The spot gold-silver ratio, also known as the Mint ratio, fell to 99.15 on Tuesday, indicating that silver had outperformed gold. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 102.58 on Monday.

Outlook for the rest of the session:

--MCX gold seen at INR 87,476–INR 89,646 per 10 gm

--COMEX gold seen at $2,951.33–$3,065.33 an ounce

--MCX silver seen at INR 89,573-INR 91,474 per kg

--COMEX silver seen at $29.46-$31.38 an ounce

End

US$1 = INR 86.27

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

Edited by Avishek Dutta

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