After falling by ₹145 yesterday, gold prices continued to decline for the second day today. Gold futures were trading at ₹37,490 per 10 gram, down by ₹54 or 0.14% after US President Donald Trump said Washington was close to a trade deal with China. So far this month, gold prices have dropped by around ₹500 per 10 gram at MCX.
MCX Silver futures March was selling at ₹43,895 per 10 gram, down by ₹31 today. In December, silver future rates are down by more than ₹1,100.
If gold prices breaks below the immediate and stiff support of ₹37,450 we can expect continued selling pressure towards ₹37,200 followed by ₹36,800 levels. “A direct turn above ₹37,780 would negate such bearish expectations,” he said.
Gold prices had touched a record high of ₹39,885 per 10 grams in early September after import taxes were increased and amid uncertainties related to the US-China trade war. Since then gold rates have retreated but are still up 20% this year.
N. Anantha Padmanaban, chairman of the All India Gem and Jewellery Domestic Council, said gold smuggling may have jumped 30% to 40% this year to 140 tons and could rise more next year. Market experts attribute the rise in illegal gold inflows to an increase in import taxes.
In the international market, gold prices fell 0.1% to $1,468.20 an ounce. Traders are now waiting for clarity on the US-China trade deal, an announcement on which is expected today. Any uncertainty on the deal would have increased the yellow metal’s appeal.
Gold not only got support due to trade war uncertainty, but the weakness in the dollar index also helped gold remain resilient, Abhishek Bansal, Chairman, ABans Group of Companies, said.