Commodities

Gold and silver daily review (February 01, 2013)

Contributed by Angel Broking

Gold

Spot gold prices declined 0.8 percent as US inflation concerns faded which led to reduction in the demand for the metal as a hedge against inflation. The US Federal Reserve had yesterday in its policy meeting said that the inflation has been below the committee's longer run objective. This caused selling in the gold prices. However, we akness in the DX cushioned sharp fall in the prices.

The yellow metal touched an intra-day low of $1,657.54/oz and closed at $1,662.99 per ounce on Thursday. On the MCX, Gold February contract ended 0.1 percent lower due to appreciation in the Indian Rupee. MCX gold prices closed at Rs.29,871 per 10 gms on Thursday after touching an intra-day low of Rs. 29,794 per 10gm.

Silver

Spot silver erased earlier gains of the previous day and ended 1.9 percent lower on Thursday. Weakness in the spot gold prices along with bearishness in the base metals pack led spot silver prices to trade lower yesterday. However, weakness in the DX cushioned sharp fall in the silver prices. Appreciation in the Indian rupee exerted downside pressure on the MCX silver prices.

The white metal touched an intra-day low of $ 31.1/oz and closed at $ 31.41 per oz on Thursday. In the Indian markets, MCX silver prices gained 0.2 percent and closed at Rs.57,849/kg on Thursday and touched an intra-day low of Rs. 57,472/ kg. Appreciation in the rupee pushed prices of white metal lower in yesterday's session.

Outlook

In today's session, we expect precious metals to trade higher as the economic data from the major consuming nations are indicating slow growth. Investors might also adopt a cautious approach ahead of the jobs data to be released in the evening today. This is likely to restrict gains in the precious metals. Weakness in the DX might support an upside in the previous metals. In the domestic markets, depreciation in the rupee is likely to act as supportive factor for the precious metals on MCX.