• Experts say gold has support near ₹52,000 and resistance near ₹56,000 levels
Gold Rate Today: It was another week of impressive gains for the precious metal as prices in the domestic markets rose nearly 1.40 per cent to hit a five-week high. The gold futures contract for February 2023 ended at ₹53,393 per 10 grams, up ₹853 from its previous week's level of ₹52,540. The spot gold price closed at $1,797 an ounce, up 2.45 per cent from last week's closing level of $1,754 an ounce.
According to commodity market experts, ease in dollar index after the US Fed indicated to reduce the pace of interest rates hike, was the major reason for the rise in the yellow metal prices. He said that the uptrend in gold price may continue further and it may go towards ₹54,500 level on MCX, while in the spot market, he expects the precious bullion metal to reach $1,840 an ounce in the near term.
Speaking on the reasons for the rise in gold prices, Sugandha Sachdeva, Vice President, Commodity & Currency Research, Religare Broking said, "The precious metal edged higher as US Fed Chair indicated to reduce the pace of rate hikes going forward Expectations are for a 50 bps rate hike at the Fed's December meeting, which has caused the dollar index to fall to a three-and-a-half-month low and prompted buying interest in the yellow metal."
The Religare expert further said that US manufacturing activity contracted in November for the first time in two and a half years, amid key economic data during the week. However, the monthly jobs report has been quite encouraging, with the US economy adding 263,000 jobs in November, well above expectations for an addition of 200,000 jobs. The unemployment rate remained unchanged at 3.7 percent, while average hourly earnings rose 0.6 percent more than expected, a major contributor to price pressures in the economy. Tightness in the labor market has once again raised concerns that the Fed will keep interest rates high for an extended period of time in its effort to curb inflation.
"Gold demand is set to increase by 28 per cent this year, reaching 1181 tonnes by September 2022. Major gold purchases this year include central banks of Turkey, Uzbekistan, India and Qatar. Rupee closes against Rs. declined by 10 per cent." Dollar due to rise in interest rates in 2022, for which RBI has bought gold for hedging. Gold prices have remained stable this year due to RBI buying apart from demand from jewelers in India," said Nripendra Yadav, Senior Commodity Research Analyst, Swastik Investmart.
Expecting the bullish trend in gold and silver to continue in the near term, Nripendra Yadav said, "Gold has support near ₹52,000 and resistance near ₹56,000. Silver has support near ₹62,000 and resistance near ₹68,000. There is resistance."
When asked about the gold price outlook in the near term, Sugandha Sachdeva, Religare Broking said, "The bullish trend in gold prices continues to be strong where they are ruling at Rs 54,500 per 10 grams in the international markets and around $1,840 per piece in the international markets." An ounce is likely to move higher. The yellow metal has managed to overcome the key resistance of ₹53,200 per 10 gram and any decline towards the same can be used as a buying opportunity in the precious metal. However , All eyes will now be on the OPEC+ meeting and the possibility of further production cuts. The oil cartel which could create significant volatility in crude oil prices in the days to come and also impact the direction of gold prices."
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