Gold futures on MCX were down 0.16 per cent, or Rs 74, at Rs 47,450 per 10 gram. Silver futures mildly gained 0.10 per cent, or Rs 66, at Rs 65,275 per kg.
The yellow metal held near two-month highs following a rally from weak US non-farm payroll data on Friday. A slower recovery in the US job market may delay Fed’s plan to taper asset-buying programs.
Gold is considered a hedge against inflation and currency debasement, caused by massive amounts of stimulus measures. The data on Friday pushed the dollar index to its lowest level since August 4.
Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities, said gold eased as the US dollar paused after last week’s decline. Also weighing on price is weaker investor interest as is evident from ETF outflows.
“Supporting price is disappointing US jobs report, persisting virus risks, China’s regulatory crackdown and geopolitical tensions relating to Afghanistan. Gold may witness choppy trade amid mixed factors. However, general weakness in the US dollar may continue to provide support,” he added.
Physical gold demand across top Asian hubs was largely muted last week, while dealers in India pinned their hopes on an upcoming festival season to bring in more customers.
In the spot market, highest purity gold was sold at Rs 47,246 per 10 gram while silver was priced at Rs 63,475 per kg on Friday, according to the Indian Bullion and Jewellers Association.
The spot price of the yellow metal has remained flat in the last one month, whereas silver has eased more than Rs 3,250 during the period under review.
The tepid job data clearly indicates that the economic growth on consumer demand has taken a few steps backward and the impact of delta variants on global economies, said Sandeep Matta, founder, TRADEIT Investment Advisor.
Trading strategy
“We expect gold prices to trade in range today in absence of the US market on account of Labour Day Holiday. COMEX Spot gold prices need to break above $1833 per ounce to sustain upside. Support for the day lies at $1810 per ounce. MCX Gold October support lies at Rs. 47200 and resistance at Rs. 47800 per 10 gram,” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
Global markets
Spot gold was steady at $1,826.65 per ounce, as of 0048 GMT. In the previous session, prices hit a peak since June 16 at $1,833.80. US gold futures eased 0.3% to $1,828.60.
Silver was steady at $24.69 per ounce. Prices rose 3.4% in the previous session, its biggest one-day percentage gain since early May. Platinum fell 0.6% to $1,018.89, while palladium rose 0.2% to $2,428.68.
