Gold prices in India: Due to heavy selling in the previous session, gold on Friday hit a nearly one-month low. After breaking around Rs 1,000 in the previous session, gold came down to Rs 47,897 per 10 grams on MCX. MCX Silver futures rose to Rs 62,011 per kg.
Biggest weekly drop possible since November
According to a Livemint report, gold remained flat in the global market and is set to register its biggest weekly decline since November. It was hit by the strengthening of the US dollar after the US Federal Reserve signaled a hike in interest rates since March. Spot gold remained flat at $1,796.41 an ounce, having lost nearly 2 per cent so far this week. On the other hand, spot silver fell 0.2 percent to $ 22.69 an ounce.
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There may be a sell-off in gold if it goes below $ 1,780
Geojit said in a note, “Selling may start when gold falls below $1,780. Also, further volatility is expected to continue. On the other hand, silver may fall, as it has already come down below $23. However, it has a lot of support at $21.40.
Data released on Thursday showed the US economy grew 6.9 per cent in 2021, its fastest growth in nearly four decades. The dollar strengthened against other currencies.
Sentiment weak, but not steadily declining
Ravindra Rao, Head, Commodity Research, Kotak Securities said, “Geopolitical tensions, rising inflationary pressures and volatility in equities are supporting gold prices. However, early more rate hikes by the Fed and strong US growth data also weighed on prices. Gold failed to sustain above $1,850 an ounce and then dipped below $1,800, weakening sentiment. However, we do not see a steady decline in the face of weak risk sentiment.”
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Gold demand will increase even in 2022
Meanwhile, the World Gold Council today said that after a 79 per cent rise in gold demand last year, this boom is likely to continue in 2022 as well. Also, increasing consumer confidence is expected to boost demand.
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