Gold price today: Yellow metal slides below Rs 47,500 ahead of Fed meet outcome

NEW DELHI: Gold and silver prices declined on Wednesday following the trend in the international markets and ahead of the crucial US Federal Reserve policy meeting outcome.

The Fed is expected to announce its stimulus tapering timeline at 1400 GMT on Wednesday. It is likely to begin paring its monthly asset purchases by $15 billion each month until ending them by mid-2022.

Amid this backdrop, gold futures on MCX were down 0.30 per cent or Rs 142 at Rs 47,480 per 10 grams. Silver futures declined 0.02 per cent or Rs 13 to Rs 63,210 per kg.

“Gold is under pressure as the US dollar holds firm ahead of the Fed decision today where the central bank may take a decision on bond tapering. Also weighing on price is persistent strength in equities and weaker investor interest. However, supporting prices are concerns about the Chinese economy amid a slowdown in economic activity and an increase in virus cases, rising inflationary pressure and mixed economic data from major economies,” said Ravindra Rao, VP- Head Commodity Research at Kotak Securities.

Gold may remain weaker ahead of the Fed decision, however, we may not see a sustained decline as the central bank is unlikely to take an aggressive approach to monetary tightening, he added.

In the spot market, the highest purity gold was sold at Rs 47,836 while silver was priced at Rs 64,204 on Tuesday, according to the Indian Bullion and Jewellers Association.

Trading strategy
“We expect gold prices to trade sideways to down for the day with COMEX Spot gold support at $1,760 and resistance at $1,800 per ounce. MCX Gold December support lies at Rs 47,300 and resistance at Rs 47,900 per 10 gram,” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.

Global markets
Spot gold fell 0.2 per cent to $1,784.04 per ounce by 0138 GMT. U.S. gold futures dropped 0.2 per cent to $1,785.30.

Spot silver fell 0.2 per cent to $23.46 per ounce. Platinum was little changed at $1,037.49, while palladium gained 0.4 per cent to $2,019.81.