NEW DELHI: Gold prices in India bucked the global trend and rose on Tuesday. Prices of the yellow metal eased in international markets as the US Treasury yields hit fresh multi-year highs following Federal Reserve chair Jerome Powell’s aggressive inflation stance.
Gold futures on MCX were trading up 0.31 per cent or Rs 159 at Rs 51,814 per 10 gram. Silver futures were trading higher by 0.46 per cent or Rs 317 at Rs 68,666 per kg.
Gold prices are supported by inflation, market volatility linked to COVID, geopolitics and robust demand from other sectors such as central banks and jewellery, said Ravi Singh, Vice President and Head of Research, ShareIndia.
“The Russian invasion of Ukraine has sparked an uptick in the demand for the safe-haven asset as investors adopt a risk-off sentiment,” he added.
In the spot market, highest purity gold was sold at Rs 51,464 per 10 gram while silver was priced at Rs 67,687 per kg on Monday, according to the Indian Bullion and Jewellers Association.
The spot prices of gold have dropped about 2,150 per 10 gram in the last couple of weeks, whereas silver has eased more than 3,200 per kg during the period under review.
Pritam Patnaik, Head – Commodities, Axis Securities, said gold prices seem to have ignored the hawkish statement made by Fed chair Powell, indicating that the US central bank was likely to raise interest rates aggressively to bring down inflation that was running too high.
“The on-ground situation in Ukraine remains tense, and in the absence of any real compromise, it has helped to create a support base for gold,” he added. “The long term is still bullish for gold, as the central bank struggles to manage inflation without compromising on economic growth.”
Trading strategy
Singh from ShareIndia suggested buying gold near Rs 51,500 for a target of Rs 51,800, whereas traders can sell the bullion below Rs 51,300 for a target of Rs 51,000.
Global markets
Spot gold was down 0.2 per cent at $1,931.84 per ounce by 0105 GMT. US gold futures were flat at $1,930.20.
Palladium fell 0.5 per cent to $2,571.64 per ounce. Spot silver was down 0.2 per cent to $25.15 per ounce, platinum shed 0.3 per cent to $1,033.99.