15 Mar , 2022 By : Kanchan Joshi
Gold and silver rates continued the recent drop after the precious metals fell more than 0.5 percent each in futures market in India. On MCX, gold futures were down 0.6% to Rs51999 per10 gram while silver fell 0.55% to Rs68470 per kg. In India, gold had jumped to Rs55,600 last week, before the current round of selloff. In global markets, gold was under pressure today as bond yields climbed ahead of a key Federal Reserve meeting where policy makers are set to raise interest rates. Bullion had jumped close to all-time highs last week as Russia’s invasion of Ukraine and higher inflation boosted demand for the haven asset.
The Ukraine crisis has led to sustained inflows into bullion-backed exchange-traded funds. Higher bond yields reduce the appeal of non-interest-bearing gold. Spot gold declined 0.4% to $1,943.09 an ounce, after touching $2,070.44 last week. Spot silver shed 0.4% to $24.92 per ounce, while platinum was down 0.1% to $1,029.16.
“Gold and silver have witnessed selling pressure on optimism of de-escalation of war between Russia-Ukraine. Both country officials’ discussions are going on for de-escalation of war and there is a hope they will reach some conclusion soon. Global equity markets gained and also pressured bullion. The U.S. Federal Reserve's two day policy meeting is starting from today and market consensus is that the U.S. Fed could raise interest rates in this meeting and the policy tone could be hawkish this time," said Rahul Kalantri, VP Commodities, Mehta Equities Ltd.
“We expect both gold and silver to remain volatile in today’s session as an anticipation of interest rate hike and hawkish policy statements from the Federal Reserve also triggered selling in precious metals. Gold has support at $1934-1920, while resistance at $1962-1980 per troy ounce. Silver has support at $24.70-24.35, while resistance is at $25.48-25.62. In rupee terms, gold has support at Rs51950–51680 , while resistance is at Rs52480–52740. Silver has support at Rs68050- 67335 while resistance is at Rs69220–70000," he added.
Position squaring ahead of Fed’s rate hike decision has also pressurized prices, says Ravindra Rao of Kotak Securities. “Gold has come under pressure amid reduced safe haven buying amid efforts to resolve Russia-Ukraine issue peacefully. Gold may remain pressurized as market players position for Fed decision however a sharp fall is unlikely," he said.
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