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Commodities Precious Metals

Gold and silver daily review (June 06, 2014)

June 6, 2014, Friday, 06:22 GMT | 01:22 EST | 09:52 IST | 12:22 SGT
Contributed by Angel Broking


Gold

Gold prices rose nearly 1 percent on Thursday; its biggest gain in three weeks after the European Central Bank cut interest rates to record lows and unveiled a package of new stimulus measures. The ECB lowered the deposit rate to -0.1 percent, meaning it will effectively charge banks for holding their money overnight. It cut its main refinancing rate to 0.15 percent, and the marginal lending rate or emergency borrowing rate - to 0.40 percent.

Meanwhile, Reuter’s survey of economists forecast that U.S. employers probably added 218,000 new payrolls last month, a step down from April's robust 288,000-job gain, but still above the average for the preceding six months.

On the MCX, gold prices rose by around 1 percent to close at Rs.26894/10gms.


Silver

Taking cues from strength in gold prices even spot silver prices gained by 1.3 percent and closed at $19/oz. Even though the base metals prices traded lower silver prices diverged and ended on a positive note.

On the MCX, silver prices rose by 1.1 percent and closed at Rs.40282/kg in line with strength in international markets.


Outlook

On an intraday basis, we expect gold and silver prices to trade on a positive note as ECB unveils a package of stimulus measure to ignite the economy. Meanwhile, the jobs data that is to be released tonight will further add boost to prices as the expectations of job additions is less compared to the estimates.

On the MCX, gold and silver prices are expected to trade positive in line with international markets.

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