Informist, Wednesday, Jul 20, 2022

By Chinmay Mungse

MUMBAI – GOLD contracts on the Multi Commodity Exchange of India were flat today, as negative cues from benchmark contracts on COMEX were offset by a weaker rupee against the US dollar, which makes the greenback-denominated commodity more expensive for Indian investors.

* Benchmark GOLD contracts on COMEX were in the red today as the US dollar strengthened against a basket of major currencies, dampening demand for the precious metal.

* Increasing bets of aggressive monetary policy tightening by major central banks also kept investors away. The Bank of Japan and European Central Bank's monetary policy announcements on Thursday are expected to give a direction to gold prices, said experts.

* "The BOJ is widely expected to stick to its ultra-loose monetary policy while the ECB may surprise markets with a 50-bps rate hike," fxstreet.com said in a report.

* Easing expectations of a 100-bps rate hike by the US Federal Reserve cushioned gold prices in the international market. 

* "The US Fed rate hike speculations and lack of economic data may keep precious metals in range for the short term with a downward bias," said Tapan Patel, senior analyst at HDFC Securities.

* At 1625 IST, the most active contracts of bullion were:
   --June gold was flat at 50,330 rupees per 10 gm on MCX
   --June gold was down 0.2% at $1,707.9 an ounce on COMEX
   --September SILVER was flat at 55,753 rupees per kg on MCX
   –-September silver was flat at $18.71 an ounce on COMEX

* Outlook for the evening session:
   --MCX gold seen at 50,100-50,600 rupees
   --COMEX gold seen at $1,700-$1,720
   --MCX silver seen at 55,300-56,100 rupees
   --COMEX silver seen at $18.40-$19.00.

End

US$1 = 79.99 rupees

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

Edited by Avishek Dutta

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