Gold Prices Slip On MCX, Silver Gains As September Begins; Fed Rate In Focus
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Gold and silver started September on a mixed note, with gold facing pressure after its recent correction while silver found support from fresh positions.
Gold prices started September on a weaker note in domestic futures trade, while silver moved higher on the Multi Commodity Exchange (MCX).
Gold futures for October delivery fell ₹208, or 0.13%, to ₹1.54 lakh per 10 grams, with 2,452 lots changing hands. In the international market, gold futures were down 0.12% at $4,432.26 an ounce in New York.
The decline in gold came amid softer spot demand. Gaurav Garg, Head of Research at Lemonn, said gold slipped after correcting sharply over the previous two sessions as markets continued to assess the Federal Reserve's policy outlook.
Safe-haven demand and movements in the dollar are offering some support to bullion prices. Markets are now waiting for US economic data for further clues on the Fed's September rate decision.
The ADP employment report and the Non-Farm Payrolls data due on Friday will be closely watched. A stronger-than-expected labour market could push US yields and the dollar higher, which may weigh on gold. Weaker employment data, on the other hand, could revive expectations of a rate cut and support precious metals.
Silver futures were trading higher on the MCX. The December contract rose ₹456, or 0.19%, to ₹2.40 lakh per kg, with turnover of 2,655 lots. Fresh positions taken by market participants supported the move.
Silver prices were weaker in international trade, with futures down 0.17% at $66.46 an ounce.
The precious metals market enters September after gold and silver saw a correction towards the end of August. The recent decline in domestic prices could bring some buying interest back into the physical market, particularly with the festive season approaching.
According to Sunil Katke, Head of Commodities at Kotak Neo, gold could fall towards ₹1.45 lakh in the near term. He expects the metal to find some support around those levels, which could then lead to a bounce-back.
For now, bullion prices are likely to remain sensitive to US employment numbers, expectations around the Federal Reserve's next policy move, the dollar and developments on the geopolitical front.
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This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
Rochelle Britto has spent 8+ years decoding India's markets, businesses, and consumer economy, reporting for ET Prime and Times Internet along the way, covering the stories behind the numbers.
A Mumbai native and perpetual planner of the next holiday, she stays far, far away from the eternal question, “Where are we going next?” When she's not chasing headlines, she's chasing new cultures, open roads, and a bit of quiet in nature.
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