Gold and silver price remain steady, set for worst week in over a month

Gold opened on the Multi Commodity Exchange (MCX) on Friday at Rs 60,233 per 10 grams and hit an intraday low of Rs 60,202. In the international market, prices hovered around $1,959.15 per troy ounce. Meanwhile, silver opened at Rs 70,998 per kg, hit an intraday low of Rs 70,974 on the MCX, and hovered around $22.71 per troy ounce in the international market.  

Anuj Gupta, Head of Commodity and Currency at HDFC Securities, said, “Gold prices recovered yesterday from lower levels and closed higher by 0.45% at 60282 levels. Silver closed higher by 0.62% and closed at 71390 levels. A hawkish statement by the FOMC members that they will keep down inflation at the target level of 2%. The Dollar Index is trading at 105.80 levels, and bond yields are also cooling off, which is positive for gold in the long run. Festival demand in India may support the gold and silver prices.” 

U.S. Fed officials “are not confident” that interest rates are yet high enough to finish the battle with inflation and may be nearing the end of how much help they can expect in lowering price pressures.  

Since the start of this week, Fed officials’ comments have been a bit mixed regarding the further path of interest rates. However, in his speech yesterday, Governor Powell made a few hawkish remarks weighing on bullions.  

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Manav Modi, Analyst, Commodity and Currency, MOFSL, said, “Gold prices were flat and on track for their worst week in more than a month, weighed down by a firm U.S. dollar and Treasury yields after hawkish remarks from Federal Reserve Chair Jerome Powell.” 

Following Governor Powell’s comments, benchmark 10-year U.S. Treasury yields rose from more than one-month lows, while the dollar index was heading for its best week in two months against its major crosses. Data showed that the number of Americans filing new claims for unemployment benefits edged down last week, signalling that layoffs remain low even as the still-strong job market shows signs of cooling. 

“Market participants also remain on edge regarding geopolitical tensions. Focus today will be on UK GDP, Michigan consumer sentiment and India IIP data,” said Modi. 

Amit Khare, Associate Vice President at GCL Broking, said, “December Gold closed at 60282(0.50%) and December Silver closed at 71050(0.80%). As per the daily chart, bullions are showing some profit booking. Traders are advised to book their longs and can make fresh short positions in Gold and Silver near the given residence level one with the stop loss of resistance level two and book near given support levels: Gold December Support 60000/59800 and Resistance 60300/60500. Silver December Support 70200/69800 and Resistance 71200/71800.”