Gold prices in India largely remained steady in the afternoon trade with a negative bias. On the MCX, gold August futures on July 7, 2020 at 3:06 pm were trading with a loss of 0.13% or Rs. 64 at Rs. 48161 per 10 gm, while silver also edged lower by 0.84% or Rs. 418 to Rs. 49372 per kg.
Positive US Services Data And Hopes On China's Recovery Offset By Rising Corona Cases And Increasing Risk Sentiment
Rise in coronavirus cases as also the increasing risk sentiment both in global and domestic markets have capped the losses in the precious yellow metal.
Retail price of 22K and 24K for the day is at Rs. 46960 and Rs. 47960 per 10 gm, respectively.
In the international market also gold largely hold on to previous levels as spike in corona positive +cases outshined positive economic indicators of improved services activity in the US and hopes of a rebound in Chinese economy.
Spot gold remained steady at 41784.06 per ounce, just $4.9 away from its 8-year high price hit in the previous week. US gold futures edged 0.1 percent higher to $1,794.30.
"The proliferation of new COVID-19 cases globally has added to lingering nerves, with investors preferring to hedge that risk via gold, even as they load up on equities again," said Jeffrey Halley, a senior market analyst at OANDA.
Also another factor that is weighing on the gold price in today's trade is the weakness in dollar which at the start of the session was at a one-month low. However it recouped some losses and is reported to trade at 2-week low. Strength in dollar against a basket of currencies renders gold pricier for investors holding other currencies.
How Will Gold Price Move Going Forward?
Though the price of any commodity or for that matter any matter is hard to predict rightly. Experts opine "Gold remains at risk of a short-term correction, given current market positioning," said IG Markets analyst Kyle Rodda. "Nevertheless, a break above $1,800 is on the cards, with buyers probably waiting on the other side of that level. In the bigger picture, fundamentals remain very constructive for gold."