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Informist, Wednesday, Oct. 30, 2024

--COMEX December gold contract at fresh all-time high of $2,801.7 per oz 

--MCX December gold contract hits new high of INR 79,775 per 10 gm 

By Sandeep Sinha

MUMBAI – Futures contracts of gold hit fresh lifetime highs on the Multi Commodity Exchange of India and COMEX on Wednesday as weak US economic data dragged the dollar index down. The positive sentiment was further aided by safe-haven demand due to uncertainty related to the US presidential election.

Data released by the US Bureau of Labor Statistics on Tuesday showed that job openings came in at 7.44 million in September, compared to 7.86 million in August. The focus now shifts to US GDP for Jul-Sept and  Automatic Data Processing non-farm employment change data later Wednesday, and the September non-farm payrolls data scheduled Friday.

At 1510 IST, the dollar index, which measures the strength of the greenback against a basket of major currencies, was down 0.2% at 104.09. A weaker greenback makes dollar-denominated precious metals attractive to foreign buyers. 

"Gold price was boosted by weaker than expected US JOLTs openings data that showed that openings in the US stood at 744,300, well short of expectations of 800,000, as even prior data was revised lower, though Conference Board consumer confidence surged to 108.70 versus the forecast of 99.50, the highest level since March 2020 as consumers felt more confident about broader economy and labour market conditions," Praveen Singh, associate vice president, fundamental currencies and commodities, at Sharekhan by BNP Paribas, said.

"Bullion prices were trading higher as safe-haven demand was boosted by increased political uncertainty in the US and Japan, as well as anticipation of more cues on interest rates post soft US jobs opening," Riya Singh, research analyst, commodities and currency at Emkay Global in a note.

However, the further upside in the yellow metal was limited due to the outflow in gold exchange-traded funds. On Tuesday, the gold holdings of SPDR Gold Trust, the world's largest gold-backed ETF, fell 1.72 tonnes to 889.78 tonnes. The fund has a market value of $79.19 billion.

The Gold Trends Report released early Wednesday by the World Gold Council showed that global central bank purchases fell 49% on year to 186.2 tonnes in Jul-Sept from 363.9 tonnes in the corresponding period last year. The sharp rise in gold prices prompted a pause in buying by some central banks alongwith tactical selling by others, it said.

At 1510 IST, the most-active December gold contract on the MCX was up 0.5% at INR 79,694 per 10 gm. The December contract hit an all-time high of INR 79,774 intraday Wednesday. The most-active December contract on COMEX was up 0.5% at $2,794.10 per ounce. It hit a fresh lifetime high of $2,801.7 earlier in the day.

Singh said that gold may see some profit booking before the release of the US data. "Overall, although the metal is somewhat overbought presently, buying the dips is preferred," he said.  End

US$1 = INR 84.08

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

Edited by Tanima Banerjee

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