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Gold prices today steady near 8-month lows, down Rs 10,000 from record highs

Gold was steady today in Indian markets after a five-day slide that pushed prices to nearly 8-month low. On MCX, gold futures were up 0.4% to ₹46,407 per 10 gram while silver inched 0.4% higher to ₹69,500 per 10 gram. In five previous sessions, gold had skidded nearly ₹2,000 per 10 gram in tandem with a decline in global rates.

In global markets, gold rates were steady near $1,782.61 an ounce, up 0.4%, after dropping to lowest in two months in the previous session. On Wednesday, gold fell to $1,769, the lowest intraday level since November 30, as a strong dollar and higher bond yields hurt the previous metal’s demand as a haven asset. Among other precious metals, silver was steady, while platinum and palladium both advanced more than 1%.

Gold, which had jumped nearly 25% last year in its biggest annual gain in a decade, has dropped more than 6% so far this year amid optimism of a faster global recovery, fueled by vaccine rollouts and hopes of more stimulus. A jump in 10-year US Treasury yields has increased the opportunity cost for non-interest-bearing bullion. In India, gold had hit a record high of ₹56,200 in August before grinding lower.

“Rising US Treasury yields and stronger US Dollar have dented the precious metals’ appeal among investors. Global economic recovery has also strengthened the bear move,” said Kshitij Purohit, Lead – International & Commodity, at CapitalVia Investment Advisor.

MCX gold has support at ₹46,000-45,900 levels, he added.

Kotak Securities in a note said that while gold remains under pressure, supporting price is hopes of additional US stimulus measures, pickup in inflation expectations and loose monetary policy stance of major central banks.

“Gold has slipped below the $1800/oz level and may remain under pressure amid continuing shift from safe havens to riskier assets. However, we may not see a sustained decline as US stimulus and loose monetary policy stance may lend some support,” the brokerage added.

 

Also on Wednesday, minutes from the Federal Open Market Committee’s January meeting showed that officials did not see the conditions for reducing their massive asset-purchase program being met for “some time.”

 

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