Gold and silver daily review (January 06, 2014)
January 6, 2014, Monday, 06:38 GMT | 01:38 EST | 12:08 IST | 14:38 SGT
Spot gold prices gained around 2 percent in the last week on the back of expectations of rise in demand for the metal from Asia. Further, it is estimated that China will overtake India as the world’s largest user of gold in 2013 and this factor too supported an upside in prices.
But the trend in SPDR gold holdings continues to remain down as holdings slipped around 0.8 percent to 794.62 tonnes in the last week. This suggests that investors remain cautious towards gold investments, especially in light of QE tapering that has already begun. The yellow metal touched a weekly high of $1240.0/oz and closed at $1236.16/oz in last trading session of the week.
In the Indian markets, prices gained by more than 2 percent due to Rupee depreciation and closed at Rs.29159/10 gms on Friday after touching a high of Rs.29242/10 gms in the previous week.
Taking cues from rise in gold prices, Spot silver prices rose around 0.4 percent in the prior week.
However, sharp upside in prices was restricted due to weak market sentiments coupled with stronger DX. The white metal touched a weekly high of $20.30/oz and closed $20.12/oz in the last trade of the week.
On the domestic front, prices rose around 0.7 percent due to Rupee depreciation and closed at Rs.45475/kg on Friday after touching a weekly high of Rs.45729/kg.
In intraday trade, gold and silver prices are expected to trade lower in dollar terms as weak fundamentals on the back of falling ETF gold holdings coupled with expected strength in the Dollar Index will act as a negative factor. But in the Indian markets, sharp losses in precious metal prices will be cushioned on account of Rupee depreciation.