Thursday, 5 July 2012

MCX Today Tips : Gold Holds Near Two-week Highs

Today MCX Gold steadied near two-week highs on Wednesday and was set for its second successive weekly gain, thanks you to a modest decline in the dollar that may sharpen trader appetite for the metal, although a U.S. public holiday is likely to temper any gains. More Information about

Today Investment demand are for bullion has flagged over the last few months, in light of the high degree of uncertainty over the impact of the euro zone debt crisis on the global economy market that has resulted in the dollar emerging as the safe-haven asset of choice, to the detriment of mcx gold.

This week could be decisive in determining the likely course of monetary policy in both the United States and the euro zone, where the low interest rates that prevail in both regions have been instrumental in creating demand for MCX gold.

The EC Bank meets on Thursday discuss to monetary policy and is widely expected to cut euro zone rates to a record low to try to contain the debt crisis, without resorting to buying the sovereign bonds of heavily indebted nations such as Spain and Italy to lower their borrowing costs.

Spot MCX gold was bid at $1,614.32 an ounce at 1422 GMT, down 0.3 percent on the day and was up nearly 1 percent on the week, set for its second consecutive weekly rally, its longest stretch of gains since late February.

MCX gold futures for August delivery traded down 0.5 percent on the day at $1,614.30 on the Globex electronic platform.

"With the U.S. off, volumes are half of what was traded yesterday and yesterday was a low-volume day. There has been a bit of profit-taking and I still see resistance at $1,630.00," Andrey Kryuchenkov, an analyst at VTB Capital said.

The May report showed the slowest growth in payrolls in a year and revived speculation that the Fed could resort to more asset purchases to anchor borrowing rates to boost the economy, particularly ahead of this November's presidential elections.

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