Gold Price Weekly Outlook: 10 Grams Yellow Metal May Trade From Rs 70K-73K, Silver Seen At Rs 86,800

MCX gold futures recorded fifth weekly gains between August 26-30, on the other hand, silver witnessed a sharp correction as investors factored in a Fed rate cut possibility in September. In the first trading week of September 2024, MCX gold is expected to range between Rs 70,000 to Rs 73,000 per 10 grams, while silver is likely to trade from Rs 82,000 to Rs 86,800.

MCX Gold, Silver Price:

Last week, on August 30, MCX gold futures with October expiry ended at Rs 71,651 per 10 grams, marginally up. While MCX silver futures also edged higher to close at Rs 85,248 in 1kg.

Gold, Silver Prices In India:

At the retail stores in India, on September 1, 2024, 10 grams of 24K is at Rs 73,040, while 22K is at Rs 66,950, and 18K of the same is at Rs 54,780.

Overall, in August 2024, gold prices in India surged by nearly 4% across the carats.

Further, 1 kg of silver is at Rs 87,000, while 100 grams is at Rs 8,700 and 10 grams of the precious metal is at Rs 870. Unlike gold, silver prices dipped marginally in August month.

Gold, Silver Weekly Outlook:

As per SMC Global Securities' Wise Money report, gold prices recorded weekly gains and a second consecutive monthly advance, driven by expectations of rate cuts by major central banks, which reduced the opportunity cost of holding non-yielding gold. At the Federal Reserve's Jackson Hole Economic Symposium, Chairman Jerome Powell signalled that the central bank is likely to lower interest rates in response to a weakening labor market and slowing inflation.

SMC's note further said, htis dovish stance from the Federal Open Market Committee (FOMC) led markets to increase their bets on a 50 basis points cut in the Fed's upcoming September decision. Recent US data revealed that the Federal Reserve's preferred inflation indicators, the headline and core PCE price indices,
were revised downward, indicating a more significant slowdown in the second quarter. Additionally, initial jobless claims fell below expectations, further highlighting a softening labor market.

Additionally, the brokerage pointed out that although US GDP growth for the second quarter was revised upward, markets still anticipate 100 basis points in rate cuts over the Fed's three remaining meetings this year. The European Central Bank (ECB) is also expected to implement rate cuts as inflationary pressures ease rapidly. The safe-haven appeal of bullion was further strengthened by escalating conflicts in the Middle East. Meanwhile, official data showed that China's net gold imports through Hong Kong rose by 17% in July, marking the first increase since March.

For the trading week between September 2-6, SMC's note said, "On the COMEX, gold prices may see a bullish move, trading between 2520-2610, while silver could trade in the range of 28.70-31.00. For the week ahead, gold prices on MCX may trade between 70000-73000, with silver expected to range between 82000-86800."

Also, Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities said, "Gold traded sideways this week, confined within a range of $2,495 to $2,529 in Comex and ₹71,500 to ₹72,250 in MCX, as market participants awaited new catalysts. With the 0.25 bps interest rate cut in the US already factored in, any further upside in gold would require a more dovish stance from the Federal Reserve, such as a 0.50 bps cut or a faster pace of rate cuts. Otherwise, gold could continue to consolidate within the $2,450 to $2,530 range in the upcoming week. In MCX, resistance is clearly visible around the ₹72,500 zone, so caution is advised when buying near the ₹72,200-₹72,500 level."