Gold entered the market on the Multi Commodity Exchange (MCX) at a price of Rs 62,784 per 10 grams on Friday and saw an intraday low of Rs 62,711. In the international market, prices hovered around $2,048.45 per troy ounce. Similarly, silver opened at Rs 75,763 per kg, hit an intraday low of Rs 75,623 on the MCX, and hovered around $24.40 per troy ounce in the international market.
Manav Modi, an analyst at MOFSL, observed that gold prices experienced a slight increase, but continued to trade within the range established over the previous week as markets speculated on when the Fed could begin rate cuts. Dovish signals from the Fed helped the metal surpass the key $2,000 mark, but comments from Fed officials at the latest policy meeting indicated a potential shift in stance, leading to uncertainties surrounding the pace of rate cuts in the coming year.
The US consumer confidence and existing home sales are influencing safe-haven assets, with US GDP and Philly Fed manufacturing index data reported lower than expected, resulting in positive gains for the metal.
Modi also highlighted that after these data points were released, US 10Y Yields remained steady at 3.8%, but the dollar index fell below the 102 mark. The focus is now on US inflation data, which could further impact the market.
Anuj Gupta of HDFC Securities noted that gold prices increased slightly and closed at 62503 levels, while silver prices closed down at 65426 levels. Gupta also mentioned that despite a subdued market before Christmas, festival demand is supporting gold and silver prices. He suggested that for trading, gold may trade within the range of $1940 and $1960 levels with a positive bias, and on the MCX, it may trade within the range of 62300 and 63000 levels. Silver, on the other hand, may trade between 75000 and 77000 levels, with an overall positive trend and a recommendation to buy on dips.
Additional insight:
The gold and silver markets are influenced by a complex interplay of factors, including economic data, geopolitical events, and market sentiment. News such as the US GDP and inflation data can have a significant impact on both metals, leading to price fluctuations and market uncertainties. Additionally, festival demand is an important consideration for traders, as it can support the prices of gold and silver during specific periods. Furthermore, the ongoing speculation about the Fed’s rate cuts and its implications for the future trajectory of the US dollar also contribute to the volatility observed in the precious metals market.
