NEW DELHI: Gold edged higher on Friday and was set for its third straight weekly gain, as concerns over the fast-spreading Delta variant of Covid-19 and a drop in US Treasury yields lifted the safe-haven metal’s demand. The yellow metal posted mild gains in domestic markets.
Sentiment in wider equity markets remained fragile as Delta virus worries threatened global economic recovery, sending Asian shares to a two-month low. Fears over an imminent monetary policy tightening by the Fed have weighed on bullion, sending gold down 7% in June.
Benchmark U.S. 10-year Treasury yields languished near more than a four-month low, reducing the opportunity cost of holding non-interest bearing gold. US dollar rose mildly, limiting gold’s appeal.
Expert believe that gold will remain volatile in India as the demand for yellow metal remains subdued in the second largest bullion market, despite the reopening of the economy after second wave of corornavirus.
Gold futures on
were up 0.28 per cent or Rs 135 at Rs 47,856 per 10 grams. Silver futures shed 0.24 per cent or Rs 165 to Rs 68,797 per kg.
“COMEX gold trades marginally higher near $1804/oz after a 0.1% decline yesterday. Gold trades higher supported by safe haven buying amid growth and virus concerns, weaker US dollar and lower bond yields,” said Ravindra Rao,CMT, EPAT, VP- Head Commodity Research at Kotak Securities.
In the spot market, highest purity gold was sold at Rs 48,324 while silver was priced at Rs 69,042 on Thursday, according to the Indian Bullion and Jewellers Association.
“However, weighing on price is Fed’s tightening expectations and continuing ETF outflows. Gold may remain choppy near $1800/oz as safe haven buying will be countered by Fed’s rate hike expectations.”
“We expect gold prices to trade sideways to up for the day with COMEX Spot gold support at $1795 and resistance at $1820 per ounce. MCX Gold August support lies at Rs. 47500 and resistance at Rs. 48100 per 10 gram,” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
Spot gold rose 0.2% to $1,805.39 per ounce, by 0312 GMT. For the week so far, it is up more than 1%. U.S. gold futures gained 0.4% to $1,806.50.
Silver was steady at $25.89 per ounce, but was heading for a weekly loss. Palladium eased 0.1% to $2,803.26, while platinum rose 0.2% to $1,077.15.