Gold demand for Akshya Tritiya may counter dollar’s rise

Fri May 10 2013

 

Gold prices in the spot and futures market are likely to swing either way as demand for the oncoming Akshya Tritiya countered the yellow metal’s fall against the dollar surge. Overnight, the US jobs data showed signs of recovery in economy, adding weight to the bearish trend.

 

Gold-backed investments

There was also some positive sign from investors as they increased their holdings in gold-backed investments. Gold held in electronic forms increased marginally to 2,241 tonnes, the first time in 40 days. Spot gold in Singapore during early trade quoted at $1,460.88, while gold futures maturing in June ruled at $1,460 an ounce on the Comex.

 

In the domestic market on Thursday, gold for jewellery (99.5 per cent purity) ended at ` 27,310 and pure gold (99.9 per cent purity) at ` 27,445 for 10 gm.

 

Rupee Vs dollar

Thursday’s gains were basically due to the rupee’s fall against the dollar as oil companies sought more of the US currency.

 

Any fall in the rupee’s value against the dollar makes import of commodities such as gold, crude oil and vegetable oil costlier. Look for June gold contracts on MCX to trade between ` 26,950 and ` 27,150, while August contracts could trade within ` 27,500.

 

Source: Hindu business line.