Commodity World , April 15 …

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MCX Gold Jun 2014

Gold settled up 0.71% at 28959 hold near 3 week highs as concerns over mounting tensions in Ukraine continued to support demand for the safe-haven asset. Gold performed better last week bolstered by the
release of the Fed meeting minutes. The report revealed that projections of the policy markets in relation to the looming rise in rates exaggerated the potential pace of policy tightening.

The bullion also drew some strength from on-going turmoil in Ukraine. The unrest deepened in the eastern regions of the country where protestors demand a separation from Ukraine. From the physical demand side, the precious metal also was well-supported as market players brought forward the recent comments of the India’s central bank’s head Raghuram Rajan who said that the RBI would steadily remove curbs on gold imports that is likely to result in stronger demand from the country that was the top importer until China overtook it in 2013.

But prices look to see some cap on higher side as solid data in the U.S. took a back seat to Ukraine-related unease. The Commerce Department reported earlier that U.S. retail sales rose 1.1% in March, exceeding expectations for a 0.8% gain. Retail sales in February were revised up to a 0.7% increase from a previously estimated 0.3% rise. Fed asset purchases, currently standing at $55 billion a month, weaken the greenback by suppressing borrowing costs to spur recovery, thus boosting gold’s appeal as a hedge.

Technically market is under fresh buying as market has witnessed gain in open interest by 0.5% to settled at 9380 while prices up 203 rupee, now Gold is getting support at 28872 and below same could see a test of 28786 level, And resistance is now likely to be seen at 29015, a move above could see prices testing 29072.

MCX Silver May 2014

Silver settled up 0.12% at 43229 recovered despite a stronger dollar on Russia-Ukraine tension, news at the weekend said the country’s army exchanged gunfire with pro-Russian separatists in several cities. Prices for the metal briefly pared gains early Monday immediately after the U.S. Commerce Department reported that retail sales jumped 1.1% in March, the biggest gain since Sept. 2012.

Gold showed little reaction to news that U.S. business inventories rose 0.4% in February. Solid data in the U.S. took a back seat to Ukraine-related unease. The Commerce Department reported earlier that U.S. retail sales rose 1.1% in March, exceeding expectations for a 0.8% gain. Retail sales in February were revised up to a 0.7% increase from a previously estimated 0.3% rise.

Core retail sales, which exclude automobiles, rose 0.7% last month, beating expectations for a 0.5% reading, after a 0.3% gain in February Consumer demand drives the bulk of U.S. economic output, and the numbers fueled expectations that the Federal Reserve will continue to wind down its monthly asset-purchasing program as the year unfolds.

Fed asset purchases, currently standing at $55 billion a month, weaken the greenback by suppressing borrowing costs to spur recovery, thus boosting gold’s appeal as a hedge. Indian consumers were buying much more silver last year as a hike of import duty on precious metals to 10% discouraged gold buying but boosted silver demand. The country’s imports in 2013 surged 189% to 6,125 tonnes from 2,115 tonnes in 2012. In December, inbound shipments amounted 825 tonnes, posting a record 6560% annual jump. Technically market is under short covering and getting support at 42899 and below same could see a test of 42570 level, And resistance is now likely to be seen at 43461, a move above could see prices testing 43694.

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