Gold Tops $1400, Gains In Dollar Could Trim Upside
MCX Gold futures witnessed a recovery from intraday lows yet again as
retail buyers poured in the major cities in India, particularly in
Mumbai. Asian and European markets eked out small gains and COMEX Gold
was also seen adding to its bounce from two and half year lows. The
metal managed to test highs above $1400 per ounce and currently trades
at $1388.80, up $6.10 per ounce on the day.
loose monetary policy risks sparking credit bubbles, which threaten to
tip the world back into financial crisis, the International Monetary
Fund warned yesterday. In its global financial stability report, the
fund cautioned that further policy reforms were needed urgently to
restore long-term health to the financial system before the long-term
dangers of monetary stimulus materialised.
The IMF noted that the
global financial crisis could morph into a more chronic phase, marked
by a deterioration of financial conditions and recurring bouts of
financial instability. In the short term, however, the fund is more
upbeat. José Vinals, IMF head of financial stability, noted that spring
has arrived to global financial markets where after very rainy days and
threatening clouds, we are beginning to see some blue skies and more
Meanwhile, US data showed that the business among
manufacturers in the Philadelphia region softened slightly in April, the
Philadelphia Federal Reserve said Thursday. The bank's
business-conditions index edged down to 1.3 from 2.0 in March, though
any reading above zero indicates that manufacturers are still expanding.
The Fed reported that the index for new orders fell to negative 1.0 in
April from 0.5 in March.
The US dollar is quoting just above
1.3000 levels against the Euro, holding onto its latest gains and could
trim intraday gains for the yellow metal. MCX Gold futures fell near its
recent low yet again buy swing back. Prices are quoting at Rs 25616,
down Rs 63 per 10 grams or 0.25% on the day or with 3.54% increase in
the open interest. Spot rates in Mumbai are around Rs 26300, excluding
VAT and local taxes and with not much of a fall emerging over last two
days, cash buying is picking up.