Gold rate today: Yellow metal eases after a run-up; silver tops Rs 65,000 on MCX

New Delhi: Gold prices eased on Friday ahead of the US jobs report, but were set to gain for the week amid a soft dollar on prospects of slower US Federal Reserve rate hikes and signs of cooling inflation.

Investors await the US Labor Department's non-farm payrolls data due later in the day for clues about how rate hikes have affected the labour market.

Gold prices are expected to trade with a positive bias for the day amid weakness in the US dollar, said ICICIDirect Research. "Investors will closely watch key economic data from the US like nonfarm payrolls and unemployment rate," it added.

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Gold futures on MCX were trading lower, down 0.13% or Rs 68 at Rs 53,825 per 10 grams. However, silver futures traded flat at Rs 65,415 per kg.

Gold is seen as a hedge against inflation, which rising rates aim to tackle, thereby diminishing the metal's appeal. Higher interest rates also make other assets more attractive compared with non-interest-bearing bullion.

Ravindra V.Rao, CMT, EPAT VP-Head Commodity Research, Kotak Securities, said that gold has moved close to four-month highs near $1820 amid weakness in the dollar and a fall in US treasury yields.

“Disappointing economic data from the US are cementing the expectation of a slower pace in rate hikes,” he said. "Forecast is for a slight moderation in the job numbers which might be positive for bullion," he added.

In the spot market, the highest purity gold was sold at Rs 53,181 per 10 grams while silver was priced at Rs 63,203 per kg on Thursday, according to the Indian Bullion and Jewellers Association.

The spot prices of gold have topped Rs 53,000 per 10 grams mark after 10 sessions, whereas silver has gained about Rs 2,000 per kg during the same period under review.

Rahul Kalantri, VP Commodities, Mehta Equities, said that gold and silver prices were sharply higher on Thursday, with gold notching a three-and-a-half-month high and silver a six-month high.

"A declining US dollar index, higher crude oil prices and falling US Treasury yields are all boosting the precious metals markets," he said. "A dovish signal by the US central bank is also fueling the metals market bulls," he added.

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Trading Strategy
“Bullion charts are now showing some profit booking and looking overbought. Momentum indicator RSI is also indicating the same,” said Amit Khare, AVP- Research Commodities, Ganganagar Commodity. He advised traders to make fresh short positions.

He suggested selling gold and silver near given resistance levels at Rs 54,000-54,200 and Rs 65,700-66,700, respectively. He also advised profit booking near support levels at Rs 53,700-53,400 and Rs 64,500 and Rs 63,700, respectively.

Global markets
Spot gold fell 0.3% to $1,796.71 per ounce, as of 0247 GMT, after hitting its highest since August 10 at $1,804.46 earlier in the session. US gold futures were down 0.2% at $1,810.70.

Gold prices have risen about 2.4% so far in the week in what would be their second straight weekly gain. Spot silver slipped 0.7% to $22.61, platinum held steady at $1,041.38 and palladium lost 1% to $1,922.13.

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