JULY 2, 2019
Gold prices today recovered after seeing its biggest one-day tumble in two years in the previous session. Gold prices were buoyed by safe-haven demand after weak global manufacturing data reignited fears about global slowdown.
Spot gold was up 0.4% at $1,389.49 per ounce.
Gold prices fell as much as 1.8% on Monday, its biggest one-day percentage decline since November 2016, touching more than one-week low of $1,381.51 after US-China over the weekend agreed on a trade truce.
Back in India, domestic prices also mirrored the global trend. On MCX, gold futures for August delivery rose 0.26% to ₹33,731, after seeing a big fall in the previous session. A stronger rupee also weighed on gold prices.
Similarly, October futures contracts inched closer to ₹34,000 by rising 0.27% to ₹33,950.
Reliance Securities in a note said that it expects the August gold futures contracts to be in the range of ₹33,700 to ₹34,165.
Latest data showed factory activity shrinking across much of Europe and Asia in June while growth in manufacturing cooled in the US as well.
Meanwhile, US President Donald Trump said on Monday that trade talks with China were under way and any deal would need to be somewhat tilted in favor of the America. Inflows continued into gold ETFs, with SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, saying that its holdings rose 0.78 percent to 800.20 tonnes on Monday from 794.04 tonnes on Friday.
The dollar index, which tracks the greenback against major rivals was flat at 96.847. In other commodity markets, worries over the outlook for the global economy weighed on oil.
Meanwhile, All India Gem and Jewellery Domestic Council (GJC) has said that it is planning to meet the Indian Banks Association (IBA) after Budget 2019, to find a solution over the liquidity crunch the industry is facing following lenders refusal to extend loans.