Gold rate slips as vaccine deployment drags price

NEW DELHI: Gold futures prices in the domestic market continued its downward journey in the morning trade for another day on Tuesday bucking the trend in the international market, but the losses were limited as India sped up vaccine deployment.

However, silver futures edged higher riding on a wave of news including upcoming stimulus packages and a softening dollar. Continued industrial demand also kept the appetite up for the white metal.

Gold futures on Multi Commodity Exchange (MCX) were down 0.10 per cent or Rs 48 at Rs 48,846 per 10 grams. Silver futures added 0.37 per cent or Rs 245 to Rs 65,674 per kg.

“Supporting the price is rising virus cases, increased US-China tensions, mixed economic data from major economies and prospect of higher US stimulus. However, weighing on price is progress on the vaccine front and weaker investor interest,” said Ravindra Rao, VP- Head Commodity Research at Kotak Securities.

“Gold may witness choppy trade as market players assess policy implication under the new Biden administration however the bias may be on the upside amid hopes of continuing stimulus measures.”

In the spot market, gold prices rose by Rs 117 to Rs 48,332 per 10 grams in the national capital on Monday with recovery in international prices and rupee depreciation. Silver also jumped by Rs 541 to Rs 64,657 per kg.

Trading strategy

“Gold prices are expected to trade sideways to up on speculations ahead of US President Joe Biden’s swearing-in ceremony. The stronger dollar may limit upside in prices keeping the range bound trading in gold. MCX Gold February futures support lies at Rs 48,500 and resistance at Rs 49,200 for the day,” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.

Global markets

Gold prices rose on Tuesday, off a 1-1/2-month low hit in the previous session, as the dollar slipped and hopes for further global stimulus underpinned the safe-haven metal.

Spot gold rose 0.2 per cent to $1,840.81 per ounce by 0226 GMT, recovering from its lowest since Dec. 2 at $1,809.90 hit on Monday. US gold futures gained 0.5 per cent to $1,839.40.

Among other precious metals, silver fell 0.5 per cent to $25.21 an ounce. Platinum rose 1.5 per cent to $1,095.74, while palladium climbed 0.2 per cent to $2,376.93.

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