NEW DELHI: Gold futures were trading with cuts on Thursday as investors turned to riskier assets after the US Federal Reserve’s latest meeting minutes indicated continued policy support and cemented hopes of a quick economic turnaround.
Officials at the Federal Reserve are concerned about the ongoing risks of the Covid-19 pandemic and are committed to supporting the economy until its recovery is more stable, according to minutes of the central bank’s most recent policy meeting released on Wednesday.
Gold futures on MCX were down 0.07 per cent or Rs 32 at Rs 46,330 per 10 grams. Silver futures dipped 0.31 per cent or Rs 205 to Rs 66,429 per kg.
“Gold weakened as the US dollar and bond yields steadied amid lack of any fresh cues from FOMC minutes. Also weighing on gold is upbeat global growth outlook and continuing ETF outflows. However, supporting price is rising virus cases, loose monetary policy stance of major central banks and improvement in consumer demand,” said Ravindra Rao, VP- Head Commodity Research at Kotak Securities.
In the spot market, gold rallied by Rs 587 to Rs 45,768 per 10 gram in the national capital on Wednesday amid rupee depreciation. In tandem with a rally in gold, silver also jumped Rs 682 to Rs 65,468 per kilogram.
Trading strategy
“We expect gold prices to trade sideways to up, following global cues with support at $1,720 and resistance at $1,760 per ounce. MCX Gold June futures may follow rupee movements with support at Rs 46,000 and resistance at Rs 46,700 per 10 grams,” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
Global markets
Spot gold inched down 0.03 per cent to $1,736.76 per ounce at 0149 GMT. US Gold futures fell 0.3 per cent to $1,736.50 per ounce.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.35 tonne to 1,028.69 tonnes on Wednesday from 1,029.04 tonnes on Tuesday.
Silver fell 0.3 per cent to $25.03 and palladium was down 0.2 per cent to $2,617.71. Platinum rose 0.1 per cent to $1,226.16.