As on 26th August, Spot Gold continued to decline by 0.52% to $ 1738.14 an ounce from $1747.06 an ounce as on 19th Aug. MCX Gold Oct futures ended at Rs.51417 per 10 gm on 26th August, down by 0.82% from Rs. 51837 per 10 gm. as on 19th August.
Gold prices weakened to a four-week low past $1,725 an ounce in early trade today while also ended the last week lower as Powell kept its tone hawkish during the Jackson hole symposium leading to a strength in dollar, Supportive during the last week were mixed US Data with US GDP contracting less than expected as still showed negative growth technically indicating recession. Meanwhile Manufacturing and Service PMI data, new orders for U.S. manufactured capital goods increased in July, but the pace slowed from the prior month. Gold ETF holdings continued outflows as holdings at SPDR Gold Shares fell to 984.23 tonnes from previous week’s 992 tonnes.
Outlook for the week: China PMI & Dollar Strength to weigh on prices.
Overall Gold continued to weaken for third consecutive week as dollar strength had been a major factor in the price. Gold was also pressured by rising treasury yields and falling ETF holdings seen in last one month as we may see some volatility in prices during the current week owing to dollar strength.
MCX Gold could continue to remain lackluster while the slide may be limited owing to depreciating rupee as yellow metal could decline further with continued supports around Rs. 50700 – 50500 / Kg. levels on MCX October Contract a breach and closing below which prices could come down further upto Rs. 49,600 / 10 gm for the current week.