India Bullion:Slip on MCX, COMEX on profit booking, Brexit vote eyed

Tuesday, Mar 26, 2019


By Roshni Devi


MUMBAI – Gold contracts on the Multi Commodity Exchange of India and COMEX fell today as traders booked profits after prices rose to multi-week highs on Monday, analysts said.


At 1706 IST, the April gold contract on MCX was down 0.6% at 32,039 rupees per 10 gm and the same-month contract on COMEX was down 0.7% at $1,314 an ounce.


The rupee's strength against the dollar also weighed on domestic prices of the precious metals. A firm rupee makes the import of dollar-denominated commodities such as gold cheaper.


On Monday, the April gold contract on MCX had hit a two-week high of 32,456 rupees per 10 gm and the same-month contract on COMEX hit a near-one month high of $1,324.50 an ounce following the release of weak economic data in the eurozone and mounting concerns about a recession in the US.


The eurozone's purchasing managers' index for manufacturing slumped to 47.7 in March from 49.4 in February, and US flash purchasing managers' index for manufacturing fell to a 21-month low of 52.5 during the month.


On Friday, the yield on the three-month US Treasury bill ended higher than that on the 10-year Treasury note, the first time since 2007 that the yield curve has inverted. An inverted yield curve is typically an indicator of recession.


In the UK, a vote on Brexit on Wednesday is also keeping markets on the edge. Prime Minister Theresa May does not expect to achieve parliamentary majority for her deal to exit the European Union.


Investors will eye further updates on US-China trade talks, as senior officials from the two sides are scheduled to meet in Beijing later this week.


"Brexit uncertainties, fresh concerns over lower US economic growth, an overly cautious Federal Reserve and uncertainties on the China negotiations continue to encourage risk-averse investors to diversify their portfolios," Walter Pehowich, executive vice-president at Dillon Gage Metals, was quoted as saying on


Worries of a global slowdown also kept base metals on the London Metal Exchange in the red, which in turn kept silver prices depressed today.


The May silver contract on MCX was down 0.7% at 38,338 rupees per kg, and the same-month contract on COMEX was down 0.7% at $15.46 an ounce.



For the rest of the day, gold contracts on MCX are seen trading at 31,980-32,480 rupees. On COMEX, they are seen in a range of $1,311-$1,331.


The silver contract on MCX is seen at 37,800-39,200 rupees, and at $15.20-$15.80 on COMEX.  End


US$1 = 68.86 rupees

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT


Edited by Avishek Dutta


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