Category: Gold News

Geopolitical tensions propel gold prices skyward amid anticipated Fed rate cuts

Gold prices opened on the Multi Commodity Exchange (MCX) on Wednesday at Rs 66,198 per 10 grams and hit an intraday low of Rs 66,077. In the international market, prices hovered around $2,177.27 per ounce.

Meanwhile, silver opened at Rs 74,487 per kg and hit an intraday low of Rs 74,359 on the MCX. In the international market, the price hovered around $24.45 per ounce.

Anuj Gupta, Chief of Commodity and Currency at HDFC Securities, said, “Yesterday, gold prices increased by 0.14% and closed at 66,114 levels. Recently, gold made a new high of 66,356 levels. Silver prices closed with a negative note, down by 0.54% and closed at 74,518 levels. Gold prices increased sharply due to geopolitical tension in the Middle East.”

Manav Modi, Analyst, Commodity and Currency, MOFSL, said, “Gold prices climbed, as expectations of interest rate cuts by the US Federal Reserve firmed, while investors waited for data due later in the week for underlying inflation trends that will help gauge the timing of these cuts.”

The dollar index is trading near its one-month high above the 104 mark. Similarly, US 10Y Yield is also hovering above the 4.2% mark, capping some gains for the metal price. On the data front, US Core durables goods orders data was reported better than expectations at 0.7% v/s 0.1%. However, US consumer confidence was slightly below estimates at 104.70 v/s 106.90.

“Gold prices also continue to find support from elevated physical demand from Chinese households, where gold’s record rally has not tarnished the buying appetite. Central bank purchases also sustain their support for gold, with China’s central bank steadily building its gold reserves. Updates regarding the recent development in the geo-political tensions, the tussle between Russia-Ukraine and Israel-Hamas is keeping market participants on edge. Gold tread water in anticipation of PCE price index data- the Fed’s preferred inflation gauge- due later this week. Focus this week will also be on the US GDP and comments from Governor Powell,” said Modi.

Jateen Trivedi, VP Research Analyst, LKP Securities, said, “Gold traded higher by 3:00 hour around 66,300 in MCX as Comex gold found support near 2170$ and rallied to 2195$ with backed up from the FED’s dovish statements the gold prices are broadly in positive trend but with resistance been seen at 2200-2205$ zones for the week. US GDP number son Thursday & Core PCE price index on Friday will be tracked keenly as they provided important impetus on FED’s watch tool.”

Additionally, Amit Khare, Associate Vice President at GCL Broking, said, “As per the daily chart Bullions are trading in the mix zone, Gold is looking strong while Silver is looking weak, Momentum Indicator RSI also indicating the same, below are the important levels for the day: Gold April Support 65,900/65,700 and Resistance 66,200/66,400. Silver May Support 74,000/73,500 and Resistance 75,000/75,500.”

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