The gold market, at present, is setting one of the most volatile trends. The Russia-Ukraine war has not been ended yet, and the yellow metal has not lost its importance as a safe haven. However, gold rates, are now moving between $1918/oz-$1940/oz. Investors and analysts are quite uncertain about the metal’s price trends.
Additionally, the US FOMC is going to take place an important role in deciding the price trend. About the gold market, Ravi Singhal, Vice Chairman, GCL securities Limited commented, “Gold prices initially erased mild losses and traded firmer in the wake of the just-released FOMC minutes. However, prices have since sold off moderately. Many deemed the FOMC minutes as containing no hawkish surprises, which allowed the precious metals markets to briefly drift higher. Rising bond yields this week are a bearish element for the metals markets. June gold futures were last down $5.00 at $1,922.60 and May Comex silver was last down $0.104 at $24.43/oz.” He added, “The US FOMC minutes showed members see a total monthly draw-down of $95 billion of U.S. securities (quantitative tightening). Many members favor a 50 basis point interest rate hike at the next FOMC meeting and possibly the same in the following few meetings thereafter. The members also believe the Russia-Ukraine war has caused inflationary pressures to significantly heat up.” With an interest rate hike in the USA, gold rates can fall in the global markets further.
Singhal thinks that in June Gold closing price can be Rs. 51596, the support price range be Rs. 51450 – 51200, and gold’s resistance can be between Rs. 51750 and Rs. 52000. Apart from the Russia-Ukraine war situation, the gold market is also dependent on the US Bond yield, which is now giving a 2.611% yield. With the rise in US Bond yield, gold rates can fall further.
The Comex gold futures were quoted at $1938.20/oz, gaining by 0.77%, till last traded. Yesterday it was last quoted at $1923.10/oz. The spot gold prices are quoted at $1925.90/oz, falling by 0.02%, till last traded. On the other hand, the US dollar index in the spot market stood at 99.54, falling by 0.10%. In India, the MCX gold in June future was quoted at Rs. 51,875 grams, gaining only by 0.54%, till last traded.
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Story first published: Thursday, April 7, 2022, 23:57 [IST]