India Bullion: Hits multi-month highs on worry over rising inflation

India Bullion: Hits multi-month highs on worry over rising inflation

Informist, Tuesday, Nov 16, 2021


By Sayantan Sarkar


MUMBAI – Concerns about rising inflation worldwide, boosted prices of GOLD and SILVER to multi-months high today in domestic and international markets. 


* Bullion prices have benefited from high inflation across the world, and especially in the US, where it hit an over 30-year high in October. Demand for assets such as gold rises as investors use the metal to hedge against rising prices. 


* The December contract of gold on the Multi Commodity Exchange of India rose to an over five-month high of 49,562 rupees per 10 gm, while the same-month contract on COMEX hit an over five-month high of $1,877.5 per ounce. 


* The December silver contract on MCX rose to 67,040 rupees per kg, which was near a more than three-month high, while the same-month contract on COMEX had touched $25.31 per ounce, also near its highest level in over three months. 


* Gold price saw almost a $100 move since the low seen at the start of the month despite an uptick in the dollar and yields on US Treasury bills, said Navneet Damani, vice president, commodities research at Motilal Oswal Financial Services. 


* In addition, European Central Bank President Christine Lagarde admitted that the spike in inflation would be higher and longer than anticipated but maintained that it would fade by next year. This indicated that there will no rate hikes anytime soon. 


* Investors will also focus on the release of the US retail sales data later today to gauge the US Federal Reserve's next move regarding its monetary policy. 


* At 1659 IST, the most active contracts of bullion were:
   --December gold was up 0.4% at 49,515 rupees per 10 gm on MCX
   --December gold was up 0.5% at $1,876.3 an ounce on COMEX
   --December silver was up 0.6% at 66,949 rupees per kg on MCX
   –-December silver was up 0.6% at $25.26 an ounce on COMEX


* Outlook for the evening session:
   --MCX gold seen at 49,100-49,725 rupees
   --COMEX gold seen at $1,850-$1,895
   --MCX silver seen at 65,940-67,550 rupees
   --COMEX silver seen at $24.79-$25.64




US$1 = 74.37 rupees


Edited by Maheswaran Parameswaran



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