Gold Surges 4.73% In A Week As Weak US Dollar, Falling Yields Boost Bullion

Gold posted a strong weekly gain of 4.73% as a weaker US dollar, falling Treasury yields and soft labour-market data strengthened the appeal of precious metals.

On the Multi Commodity Exchange (MCX), October gold futures rose 0.11% on Friday to Rs 1,51,985, while September silver futures advanced 0.15% to Rs 2,31,804 per kg. The weekly rise also pushed up physical gold prices.

According to the India Bullion and Jewellers Association (IBJA), 24-carat gold was priced at Rs 1,49,621 per 10 grams on Friday, compared with Rs 1,42,863 at Monday’s market opening.

A weaker-than-expected US employment report provided fresh support to bullion.

The economy unexpectedly recorded a decline of 23,000 jobs in July, against expectations of an increase of around 80,000.

Previous employment figures also faced substantial downward revisions, with changes to the preceding two months reducing payrolls by roughly 1,03,000 jobs, an analyst said.

The latest figures, along with weaker ADP private payrolls and other labour-market indicators, lowered market expectations of a September Federal Reserve rate hike to about 44%, from nearly 58%.

The shift in rate expectations pushed the benchmark 10-year US Treasury yield down to around 4.60%, after touching an intraday high of 4.68%.

Gold had started the week under pressure after reduced geopolitical risk premiums followed the postponement of a planned US strike on Iran.

The metal later reversed those losses and reached a seven-week high after the employment data.

Key Levels to Watch

Commodity experts see COMEX gold facing resistance at $4,470-$4,500, with support at $4,330-$4,300.

For MCX gold, the resistance zone stands at Rs 1,52,200-Rs 1,52,800, while the support zone is at Rs 1,50,000-Rs 1,50,700.

Markets will now focus on Federal Reserve communication, Treasury yields, the US dollar and developments around the Strait of Hormuz.

The July US inflation report due next week will also be important for the Fed’s policy outlook.

Also Read: IMD Forecast: Heavy Rain Likely Across Several States On Saturday