Informist, Monday, Dec 13, 2021

By Chinmay Mungse

MUMBAI – GOLD contracts were trading higher today on the Multi Commodity Exchange of India and the COMEX after US consumer inflation rose to a multi-year-high, which boosted the appeal of the precious metal as a hedge.

* SILVER contracts were up on the MCX tracking gains in contracts on COMEX. 

* US consumer price index rose to a 39-year high of 6.8% in November. Investors are now waiting for the outcome of the US Federal Reserve policy meeting that will be announced late Wednesday.

* "Given that the price pressure is likely to remain high, and above the pain threshold of the US Federal Reserve, it is expected that the Fed normalises its monetary policy more quickly and scale back its bond purchases more rapidly than it has been doing so far," said Commerzbank AG.

* Even though Fed Chairman Jerome Powell has made it abundantly clear that the US central bank is open to accelerating the asset purchase tapering and hike interest rates, analysts are waiting for a clear signal.

* "Though the market has factored in interest rate hike, inflationary pressure supported the precious metal. The rates are expected to fluctuate till the outcome of Fed meet," said Ajay Kedia, head of research at Kedia Capital.

* "Unemployment claims data will give Fed the confidence to proceed with raising interest rates," said Manoj Jain, head of research at Prithvi Finmart. Jobless claims in the US fell to their lowest level in 52 years the previous week.

* At 1834 IST, the most-active contracts of bullion were:
   --February gold was up 0.2% at 48,257 rupees per 10 gm on MCX
   --February gold was up 0.3% at $1,790.7 an ounce on COMEX
   --March silver was up 0.6% at 61,497 rupees per kg on MCX
   –-March silver was up 0.5% at $22.3 an ounce on COMEX

* Outlook for the evening session:
   --MCX gold seen at 47,850-48,450 rupees
   --COMEX gold seen at $1,750-$1,810
   --MCX silver seen at 60,560-61,510 rupees
   --COMEX silver seen at $21.93-$22.51

End

US$1 = 75.76 rupees

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

Edited by Ashish Shirke

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