Gold up by Rs 100, reclaims Rs 32,000-level on local jewellers' buying

Gold prices reclaimed the Rs 32,000-level by rising Rs 100 to Rs 32,080 per 10 grams today, taking strength from scattered buying by local jewellers amid a firm trend overseas.

Silver also strengthened by Rs 200 to Rs 40,500 per kg due to increased offtake by industrial units and coin makers.

Gold prices firmed up after falling for three straight days, mainly because of fresh buying by local jewellers at the domestic spot market, coupled with a better trend globally.

Globally, gold rose 0.26 per cent to USD 1,315 an ounce and silver by 0.64 per cent to USD 16.50 an ounce in New York yesterday as the dollar backed off its day's highs, raising demand for the precious metals.

In the national capital, gold of 99.9 per cent and 99.5 per cent purity rebounded by Rs 100 each to Rs 32,080 and Rs 31,930 per ten grams, respectively. It had lost Rs 220 in the previous three days.

Sovereign, however, held steady at Rs 24,700 per piece of eight grams.

Gold sparkled in 2017 despite record surge in US stocks, 3 Fed rate hikes

Gold is opening the new year on the front foot. Bullion advanced for an eighth straight day to head for the longest stretch of gains since mid-2011, building on an annual surge that pushed the precious metal to its best year in seven as the dollar weakened.

Bullion for immediate delivery advanced as much as 0.5 per cent to $1,309.32 an ounce, the highest level since September 26, and was at $1,309.06 at 6:37 am in London, according to Bloomberg generic pricing. Last year, the commodity climbed 14 per cent as the Bloomberg Dollar Spot Index lost 8.5 per cent to post the steepest decline since at least 2005.

Gold's strong run in 2017 came even as US stock markets surged to records and the Federal Reserve increased interest rates three times amid signs of an improving economy. Fed policy makers are projecting another three hikes in 2018, while other central banks around the world have also shifted toward a tighter monetary stance, with the European Central Bank planning to halve its asset purchases starting this month.

"As global complacency over the trajectory of US rates continues to be astoundingly low, precious metals, in general, should continue to benefit," Jeffrey Halley, senior market analyst at Oanda Corp in Singapore, said in a note. "The old adage that the market can stay irrational longer then you can stay solvent appears to be alive and well in the gold market at the moment."
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Gold retreats from one-month high ahead of Fed meeting

Gold prices retreated from a one-month high on Tuesday as equities gained ahead of a US Federal Reserve meeting that is expected to provide more clues about monetary policy.

The market is not expecting an interest rate increase at the Fed's two-day meeting starting on Tuesday but it is looking for hints on the timing and extent of future moves.

Spot gold was 0.2 per cent lower at $1,252.59 an ounce by 1326 GMT, not far from the previous session's peak of $1,258.79, its highest since June 23.

US gold futures fell 0.2 per cent to $1,252.

"The market is looking for clarity on the Fed's tightening cycle and when they are going to start with the tapering (of monetary stimulus)," said ETF Securities analyst Martin Arnold.

Taking the shine off gold slightly, investors climbed into European equities after a string of solid corporate updates. The US dollar hovered near a 13-month low against a basket of currencies on Tuesday, with traders not expecting the Fed meeting to alter the currency's recent weakness.

Markets give a less than 50 per cent probability of a US interest rate increase before the end of the year, according to CME's Fedwatch tool.

Also supporting gold were hurdles standing in the way of US President Donald Trump's economic stimulus and tax reform agenda.
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