Gold rates in India near 9-month high, silver prices jump

 

• The gold price in India has increased by ₹3,500 per 10 grams in the last six weeks.

Gold rates in India edged closer to a 9-month high, while silver also advanced tracking global rates. On MCX, gold futures rose 0.3% to ₹54,310 per 10 grams, while silver rose 0.4% to ₹68,072 per kg. In global markets, gold remained in a range-bound range as investors turned cautious ahead of US inflation data and Federal Reserve's rate-hike decision. In global markets, spot gold was up 0.1% at $1,783.16 an ounce while silver was up 0.2% at $23.34 an ounce.

“We expect bullion prices to remain volatile in today's session. Gold has support at $1772-1764 while resistance is at $1794-1808. Silver has found support at $23.10-22.82, while resistance lies at $23.55-23.78. In rupee terms, gold takes support near ₹53,780-53,650, while resistance lies near ₹54,280-54,450. Silver has taken support at Rs 67,150-66,580, while resistance lies at Rs 68,320-68,880.

US inflation data will be announced later today while Fed and ECB policy meetings are also due later this week. Traders now expect a 50 basis point rate hike by the Fed.

Low rates are beneficial for bullion because it reduces the opportunity cost of holding a non-yielding asset.

Apart from expectations of a slowdown in rate hikes by global central banks, the continued easing of Covid restrictions in the world's biggest gold consumer - China - has also helped push gold rates higher over the past two months. In India, the yellow metal has gained ₹3,500 in the last six weeks.

While US annual Producer Price Index (PPI) data released last week showed some softening of inflation compared to previous figures, it was slightly higher than forecast.

"The extent of the improvement in inflation is not enough to warrant Fed easing. However, as economists agree that CPI is a better measure of inflation, next week's US CPI data will be an important market mover as a softer print could support . believe that inflation is indeed coming down. Soon after the US CPI data, the Federal Open Market Committee (FOMC) will conclude its two-day meeting, which will be its last for the year. On the price front, Comex Gold still double top Maintaining resistance at $1825/oz, Kotak Securities said in a note.