MCX Gold October futures may fall to Rs 50800 this week; all eyes on Fed Chair Powell’s speech at Jackson Hole
时间:2024-06-26 06:40:54 阅读(143)
By Jigar Trivedi
MCX Gold October futures, having appreciated for four consecutive weeks, ended the previous week with a more than 2% drop. MCX Silver also declined by nearly 6% after Chinese economic data raised questions for the recovery in the region. Comex gold dropped to $1,749 an ounce, dropped by more than $50 or 2% in the week gone by, weighed down by the US Federal Reserve’s commitment to keep raising interest rates to bring down inflation. The US central bank’s hawkish stance has pushed up the dollar to a one-month high against major rivals, making gold more expensive for buyers holding other currencies.
Also read: Gold price tumbles as demand for safe-haven falls amid hawkish FED moves, expect more weakness ahead
In the latest Fed commentary, St. Louis Fed Bank President James Bullard said he is considering support for a third straight 75-basis point rate hike in September and said he is not ready to say the economy has seen the worst of the inflation surge. On 18th August, holdings at the SPDR Gold ETF slipped to $985.8 tonnes from $ 1,005.5 tonnes as on 1st August, indicating more of the liquidation.
Comex silver fell to $19.2 per ounce, on track to close the week 8% lower and extending recent losses to a three-week low as the Federal Reserve’s pledge to curb inflation drove investors to favor the US dollar instead of non-interest-bearing bullion assets. The dollar Index hovered above 107.5, approaching a 20-year high of 108.5 hit in July, and was up about 2% so far this week, lifted by hawkish remarks from Federal Reserve officials indicating their commitment to further interest rate hikes. Traders will get more insights from Fed Chair Jerome Powell at next week’s annual Jackson Hole symposium.
The euro depreciated to below $1.01, approaching the key $1 dollar parity level as investors balance the ECB policy tightening path against the region’s economic outlook. The ECB is seen raising rates by 50 bps in September, following a similar move in July to tame soaring inflation but the region’s outlook is of concern due to the energy crisis triggered by reduced supplies from Russia.
Also read: Nifty may consolidate in 18000-17500 range this F&O expiry week, use dips to buy in Bank Nifty; Buy SBI, Titan
We don’t see any sort of a war premium to support the yellow metal in the near future, be it US – China, China – Taiwan or Russia – Ukraine. As mentioned above, this week, key focus will be on the Fed Chair Powell’s speech at Jackson Hole for more cues on the rate hike trajectory. We expect the dollar index to move higher to 109 mark and the Comex gold may decline to $1,710 – 1,700 an ounce. In that scenario, MCX Gold October is also likely to drop to Rs. 50,800 per 10 grams this week.
(Jigar M Trivedi, Senior Analyst Currency & Commodities, Reliance Securities Limited. Views expressed are the author’s own.)
上一篇:Wall Street rises as bank fears fade, focus on inflation data
下一篇:Zomato share price plunges 14% intraday, hits new all-time low; check what’s fuelling the sell-off
猜你喜欢
- Venus Pipes IPO subscribed 2
- Wait for Q2 results to enter stock markets; smallcaps, midcaps may outperform in near term - Interview
- Warren Buffett vs Charlie Munger- Key differences, similarities between two investing giants
- Wall Street Week Ahead- Cloudy valuations give investors pause in buying beaten-up U
- What role does content marketing play in driving customer engagement and loyalty in the digital sphere-
- Veteran billionaire US investor says no gains to be made in share markets in next 10 years
- Victory of justice against arrogant BJP government- Rahul Gandhi on Bilkis Bano verdict
- Venus Pipes IPO gets 16
- Venus Pipes & Tubes raises Rs 49 crore from anchor investors