Domestic gold prices were flat on Tuesday as the dollar held on to two-decade highs, denting the appeal of the yellow metal and making it less attractive for holders of other currencies. Sharp gains in equities — boosting investors' appetite for riskier bets — also hurt gold rates.
On MCX, gold futures were down by Rs 7 at Rs 49,295 per 10 grams at the last count, having moved within a range of Rs 49,281-49,457 earlier in the day. Silver futures, however, eked out a gain of Rs 217 or 0.4 percent to Rs 56,901 per kilogram.
The yellow metal reflected the trend seen overseas. Spot gold was last seen nearly unchanged at $1,676 an ounce.
Globally, investors awaited the outcome of a two-day policy meeting of the Fed, which begins later in the day. The US central bank is widely expected to announce a 75-basis-point hike in the key lending rate.
Rising interest rates dent gold's appeal as a safety bet, as they increase the opportunity cost of holding non-yielding bullion.
The
rupee began the day stronger by seven paise against the US currency at 79.70. The dollar index — which gauges the greenback against six peers excluding the rupee — held steady at 109.3, not far from the highest level in two decades.
Many analysts expect gold to remain volatile in the near term.
"Gold and silver could hold on to their support levels of $1,660 per ounce and $18.8 per ounce respectively in the near term," said Manoj Kumar Jain, Head-Commodity and Currency Research at Prithvi Finmart.
At MCX, he sees support for gold at Rs 49,150-48,980 and resistance at Rs 49,450-49,600.
"We suggest buying silver on dips around Rs 56,350 with a stop loss of Rs 55,900 on a closing basis for a target of Rs 57,400," Jain added.
Indian equity benchmarks
Sensex and
Nifty50 built on to opening gains led by buying across sectors.
(With agency inputs)
(Edited by : Sandeep Singh)
