Informist, Friday, Sep 22, 2023

By Sandeep Sinha

MUMBAI – Futures contracts of GOLD on the Multi Commodity Exchange of India and COMEX rose today on account of safe-haven demand and fresh inflows into exchange-traded funds.

The yellow metal received support from increased safe-haven buying on fears that US federal lawmakers would not be able to pass a bill by Sep 30 to avert a shutdown of the government from Oct 1.

On Thursday, gold holdings with the SPDR Gold Trust, the world's largest gold-backed ETF, rose by 0.58 tn to 878.83 tn. The fund has a market value of $54.09 bln.

However, the upside in the metal was limited by strength in the dollar, which makes commodities priced in the greenback expensive for holders of other currencies, dulling demand. The dollar index, which measures the strength in the greenback against a basket of six major currencies, was up 0.1% at 105.52.

"We assume that the price performance in the coming weeks will continue to be dictated by US economic and inflation data because they will mainly determine the Fed's interest rate policy," Barbara Lambrecht, commodity analyst at Commerzbank AG, said in a note.

"Until there are clear signs that an interest rate turnaround is on the cards, the gold price-–as driven by data-–is likely to fluctuate without any clear direction," she wrote.

The spot gold-silver ratio, also known as the mint ratio, was lower at 81.43, indicating that silver had outperformed gold. The ratio measures the ounces of silver required to buy an ounce of gold.

SILVER prices traded higher today, taking cues from gold and value buying at lower levels.

At 1905 IST, MCX Bulldex, an index tracking the real-time performance of gold and silver futures on the MCX, was up 42 points, or 0.3%, at 15776 points.

The October and December gold contracts recorded turnovers of 13.08 bln rupees and 3.87 bln rupees, respectively. At 1905 IST, the September and December silver contracts saw turnovers of 25.47 bln rupees and 1.13 bln rupees, respectively.

Traders rolled over their long positions in the most active December gold futures by 439 lots to 9,943 lots. Market players trimmed their bearish positions in the MCX December silver contract by 122 lots.

The average traded price for the October gold contract on the domestic exchange was 58,849.10 rupees per 10 gm.

On the technical charts, the MCX October gold contract traded lower than the five-, 20-, 50- and 100-day simple moving averages, but lower than the 200-day simple moving average. The momentum oscillator, Relative Strength Index, was at 47.97, suggesting range-bound movement in price.

At 1910 IST, following were the most-active contracts of bullion:

 -October gold was up 0.2% at 58,915 rupees per 10 gm on MCX

 -December gold was up 0.4% at $1,946.50 an ounce on COMEX

 -December silver was up 0.6% at 73,523 rupees per kg on MCX

 –December silver was up 1% at $23.93 an ounce on COMEX

Outlook for the rest of the session:

 -MCX gold seen at 58,650–59,350 rupees per 10 gm

 -COMEX gold seen at $1,938.0–$1,955.0 an ounce

 -MCX silver seen at 72,600-74,000 rupees per kg

 -COMEX silver seen at $23.80-$24.15 an ounce

End

US$1 = 82.93 rupees

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

Edited by Rajeev Pai

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