The dollar and longer-dated Treasury yields retreated from recent highs following a hotter-than-expected US inflation data, which supported the bullion.
Gold futures on MCX were trading down 0.22 per cent, or Rs 107, at Rs 47,809 per 10 gram. Similarly, silver futures were down 0.55 per cent, or Rs 346, at Rs 62,718 per kg.
The yellow metal traded higher in early trade, gaining post US inflation data. US FOMC minutes showed that the Federal Reserve may start tapering bond buying program by mid-November this year.
US consumer prices increased solidly in September as Americans paid more for food, rent and a range of other goods, putting pressure on the Biden administration to urgently resolve strained supply chains, hampering economic growth.
Minutes from the Federal Reserve’s September meeting showed the central bank could start reducing its crisis-era support for the US economy by mid-November.
Vidit Garg, Director, MyGoldKart said, “Gold is just following yields at the moment. The initial reaction after CPI (consumer price index) data was a big spike in yields, which is now starting to fade away.”
Physical gold rates in India have climbed near two-month high in the domestic market after trading at a discount for over two months, thanks to strong buying in yellow metal ahead of the busy festive season.
In the spot market, highest purity gold was sold at Rs 47,487 per 10 gram while silver was priced at Rs 62,136 per kg on Tuesday, according to the Indian Bullion and Jewellers Association.
The spot price of the yellow metal has gained about Rs 1,650 per 10 gram in the last two weeks, whereas silver has risen more than Rs 4,000 per kg during the period under review.
Ravi Singh, Vice President & Head of Research, ShareIndia, said IMF cut its global growth forecast for 2021 in its July report. The shaky confidence in global economies is likely to drive gold prices higher.
Trading strategy
“We expect gold prices to trade sideways to up for the day with COMEX Spot gold support at $1,770 and resistance at $1,800 per ounce. MCX Gold December support lies at Rs 47,600 and resistance at Rs 48,200 per 10 gram,” Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
Global markets
Spot gold was little changed at $1,793.72 per ounce by 0100 GMT. Prices hit their highest level since September 16 at $1,795.81 on Wednesday. US gold futures slipped 0.1% to $1,792.20.
Spot silver rose 0.1% to $23.09 per ounce, having hit a near one-month high in the previous session. Platinum was flat at $1,019.68 and palladium eased 0.1% to $2,103.81, having jumped as much as 5.2% on Wednesday.
