Gold and silver prices today: Yellow metal languishes near one-month lows

Gold prices opened on the Multi Commodity Exchange (MCX) on Tuesday at Rs 59,130 per 10 grams and hit an intraday low of Rs 58,959. In the international market, prices hovered around $1,917.25 per troy ounce. Meanwhile, silver opened at Rs 70,207 per kg and hit an intraday low of Rs 70,071 on the MCX. The price hovered around $22.67 per troy ounce in the international market.

Spot gold closed with a loss of 0.53% at $1914.59 Wednesday as the total known global gold ETF holdings fell for the twelfth straight day through August 8. China's PPI and CPI inflation data fell on a y-o-y basis, thus raising concerns about deflation.

Praveen Singh – Associate V.P., Fundamental Currencies and Commodities, Sharekhan by BNP Paribas, said, "The U.S. Dollar Index closed 0.05% lower at 102.48. The two-year U.S. yields at were up 1.06%, whereas the ten-year yields slipped 0.30%. Today's US CPI inflation data for July will be crucial for the metal. Softer than expected CPI data may support the metal prices to some extent. However, the upside may remain capped as most of the recent U.S. macroeconomic data have been mostly upbeat. The Citi Suprise Index has reached a 28-month high."

Further, gold prices continue to hover near one-month lows as investors braced for U.S. inflation data that would shape the Federal Reserve's upcoming interest rate decisions. A slight dip in U.S. Yields and Dollar Index was witnessed in the first half of yesterday's session. However, both continue to trade near the previous week's highs, above 102 and 4%, respectively.

Manav Modi, Analyst, Commodity and Currency, MOFSL, said, "China's consumer sector was under pressure following negative CPI and PPI data in July as it struggled to revive demand and pressure mounted on Beijing to release more direct policy stimulus. Some Fed officials also called for more interest rate hikes earlier this week, citing stubborn inflation. The U.S. central bank said that it will potentially raise interest rates at least once more this year. Any sign of sticky inflation gives the Fed more impetus to keep rates high and policy tight, weighing on bullions."

Expectations of a higher CPI reading in July also gave a boost to the Dollar. "President Biden signed an executive order that will prohibit some new U.S. investment in China in sensitive technologies like computer chips and require government notification in other tech sectors, a move that could renew tensions between the world's biggest economies, however, further clarity will be required on the same. Focus today will also be on the RBI policy meeting," said Modi.

Amit Khare, Associate Vice President at GCL Broking, said, "October Gold closed at 58973(-0.47%) and September Silver closed at 69972(-0.36%). Bullions daily charts are trading near the oversold zone, any time we can see short covering rally in billions, Momentum Indicator RSI also indicating the same , So traders are advised to make fresh buy positions in Gold and Silver near given support level one with the stop loss of support level two and book near given resistance levels: Gold October Support 58900/58700 and Resistance 59200/59500. Silver September Support 69500/69000 and Resistance 70500/71000."