Premiumy Gold prices in India rose for the second day in a row, tracking a similar trend in global markets. On MCX, gold futures edged higher above ₹53,000 per 10 gram while silver was flat at ₹62,800 per kg. Traders remained cautious ahead of Federal Reserve Chair Jerome Powell's speech later today for more clues into the US central bank's monetary policy path. Gold prices in India are up about 5% or ₹2,500 per 10 gram - the second best month of the year - but still down about ₹3,000 from all-time highs of ₹56,200 levels of August 2020.
Prospect of a weakening of pace of monetary tightening by central banks and a pullback in US dollar has helped lift gold prices this month.
In global markets, spot gold was up 0.2% at $1,752.95 per ounce. Spot silver slipped 0.1% to $21.23. Gold was supported by a weakening of the dollar index, making bullion less expensive for other currency holders. Powell's speech is scheduled at a Brookings Institution event at 1830 GMT.
Ravindra V. Rao, Head Commodity Research, Kotak Securities, said although gold closed higher yesterday, it was bounded in a range as traders await important US economic data prints as well as Fed Chair Powell's speech.
“US Dollar index is also range bound between 107-106 after a recovery from lower levels. Gold is set for a best month in this year as the expectation of a smaller rate hike by Fed in their upcoming meetings has supported the yellow metal. Traders are on the side-lines awaiting the Fed chair speech as that will provide more cue on the US economy and Fed’s stance in the future monetary policy. Next three days will be important for precious metals amid important data prints like US Q3 preliminary GDP, ISM manufacturing PMI and NFP report," he said.
Analysts would also be watching the covid scenario in China, the world's biggest consumer of gold. A gradual lifting of restrictions in China could bolster jewellery demand. Data released today showed China's factory activity contracted at a faster pace in November, an official survey showed, weighed down by softening global demand and COVID-19 restrictions. (With Agency Inputs)