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Informist, Friday, May 30, 2025

By Ashutosh Pati

MUMBAI – Futures contracts of gold fell on the Multi Commodity Exchange of India, tracking a fall in contracts on the COMEX because of a firm dollar. Market sentiment was weighed down as traders remained cautious ahead of the release of the US Core Personal Consumption Expenditure price index later in the day.

At 1642 IST, the most-active August GOLD contract on the COMEX was down 0.7% at $3,319.9 per ounce. The most-active August gold contract on the MCX fell 0.5% to INR 95,960 per 10 grams. "Market participants are exercising caution ahead of the US PCE inflation report for potential indications regarding the (US) Federal Reserve's future interest rate decisions," Kotak Securities said in a report.

At 1646 IST, the dollar index, which measures the greenback's strength against a basket of six major currencies, was up 0.2% at 99.54. A stronger dollar makes dollar-denominated commodities such as gold expensive for holders of other currencies, denting demand.

However, uncertainties around US tariffs could limit the downside in prices of the yellow metal. Gold prices had risen in the last session after the US appeals court temporarily reinstated the tariffs on Thursday, a day after a federal court had struck them down.

"...the court ruling primarily concerned reciprocal tariffs, but not sectoral tariffs on aluminium and steel, for example. The US government could therefore focus more on these instead of country-specific tariffs. The trade conflict is therefore far from over, which means that the economic outlook remains gloomy and expectations of interest rate cuts are likely to remain strong," Thu Lan Nguyen, head of FX and commodity research at Commerzbank, said in a report. "In addition to the continuing high demand for safe havens, gold could also benefit from this," Nguyen added.

SILVER contracts fell on the MCX and COMEX, tracking the decline in gold prices. At 1655 IST, the most active July silver contract on the MCX was down 0.3% at INR 97,590 per kg. The same-month contract on COMEX was 0.5% lower at $33.24 per ounce.

Outlook for the rest of the session:

--MCX gold seen at INR 93,519–INR 96,759 per 10 grams

--COMEX gold seen at $3,211.3–$3,382.8 an ounce

--MCX silver seen at INR 95,695-INR 99,583 per kg

--COMEX silver seen at $32.24-$34.05 an ounce 

End

US$1 = INR 85.58

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

Edited by Saji George Titus

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