Gold prices drops by Rs 7,000 from record highs; Silver rates also falls
Gold and Silver prices in India inched lower today amid flat global rates. On MCX, gold future was marginally lower at Rs 49,131 per 10 gram while silver rates fell 0.3% to Rs 71,619 per Kg. In the previous session, both gold and silver had inched up by 0.35% each. On the domestic front, MCX gold faces resistance at Rs 49,550 – 49,750 levels while has supported at Rs 48,210, say analysts.
Last week, gold had hit an almost five-month high of Rs 49,700 in Indian markets amid a global rally on lingering worries over inflation. A relatively softer dollar also improved the appetite for gold. A mildly disappointing US job data that weakened the US dollar, offered some support for gold. Still, gold is down about Rs 7,000 from last year’s record high of Rs 56,200.
In international markets, gold rates were flat, supported by a weaker dollar and lower bond yields. Spot gold was near $1,900 per ounce.
Technically, international gold is trading with marginal sideways and negative bias below $1,900 levels and may continue to decline and test the support of $1,875 – $1,865 levels, say analysts at CapitalVia Investment Advisor.
The dollar index, which measures the greenback against a basket of major currencies, was flat at 90.003, well below a three-week high of 90.627 hits last week. The benchmark 10 years yield was pinned near more than one-week low, reducing the opportunity cost of holding non-interest bearing gold.
On gold traders’ radar will be US consumer price data to be released later this week. Gold is often viewed as a hedge against inflation. SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holding fell 0.6% to 1, 037.33 tonnes on Monday from 1,043.16 tonnes on Friday.