Gold is viewed as a Hedge against inflation: Resistance seen at Rs 47,740 per 10 gms.
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Gold is considered a hedging tool against inflation and currency debasement. The Fed’s tapering would tackle both those conditions thereby diminishing gold’s appeal.
Gold prices in India traded higher on the Multi Commodity Exchange (MCX) Friday following gains in international spot prices. However, a stronger US dollar limited the upside in the precious metal prices.
Gold futures for October delivery rose 0.21 percent to Rs 47,270 per 10 grams as against the previous close of Rs 47,169 and the opening price of Rs 47,250 on the MCX. Silver futures traded 0.09 percent lower at Rs 62,076 per kg. The prices opened at Rs 62,185 as compared to the previous close of Rs 62,133 per kg.
Gold prices are likely to remain sideways to positive amid concerns over economic growth on rising Delta variant of coronavirus and geopolitical tensions. The gold-silver ratio spiked to nearly 8 months high. The silver is expected to remain range bound,” International gold prices edged higher on Friday, as growing concern over the spread of the Delta variant of the corona virus and its impact on economic recovery soured risk sentiment.
Spot gold rose 0.3 percent to $1,785.93 per ounce, and it’s up about 0.4 percent for the week. US gold futures were up 0.3 percent at $1,788.10.
The minutes of the US Federal Reserve’s latest meeting raised worries about an early tapering of monetary stimulus by the US Federal Reserve.
Gold is viewed as a hedge against inflation and currency debasement. The Fed’s tapering would tackle both those conditions thereby diminishing gold’s appeal.
Meanwhile, weakness in the Indian Rupee and selling in the domestic equity market supported the precious metal prices. Rupee depreciates.
The trend on gold is likely to remain positive. Hence, buy-on dips should be deployed. On MCX, gold may find support at Rs 46,950 and resistance at Rs 47,740. Support for silver is seen at Rs 61,400 and resistance at Rs 63,200,
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