Gold rate today trades tepid as US dollar continue to attract buying on dips

According to bullion market experts, gold price rebound yesterday after Dollar Index came down below 105 levels but hawkish US Fed officials on interest rate renewed US inflation fears that triggered fresh buying in the US dollar. They said that gold prices would continue to remain range-bound in ₹55,300 ₹56,200 and $1,800 to $1,850 per ounce range till final outcome of the US Fed FOMC meeting arrives. They advised gold investors to keep booking profit on every rise and maintain buy on dips strategy in precious yellow metal.

Speaking on gold price outlook, Anuj Gupta, Vice President — Research at IIFL Securities said, “US dollar is expected to remain major trigger for the gold price movement as hawkish US Fed has triggered switching of money from gold, equities and other assets towards the forex market. This trend is expected to continue till US Fed FOMC meeting scheduled on 21-22nd March 2023. We witnessed some buying interest in gold in last session due to profit booking trigger in US dollar. However, the US dollar is still a ‘buy on dip’ asset for investor and it has added 0.21 per cent on Thursday deals.”

Highlighting the reason for strength in the US dollar, Marc Despallieres, Chief Strategy and Trading Officer at Vantage said, “Data released in the US showed ISM Manufacturing PMI increases to 47.7 in February, which came in below the market expectation of 48. The PMI report indicated that the economic activity in the US manufacturing sector continued to contract in February, providing some support to the US dollar.”

Sharing pivot levels in regard to gold rates today, Anuj Gupta of IIFL Securities said, “In international market, gold price has strong support placed at $1,800 per ounce levels whereas it is facing immediate hurdle at $1,850 levels. On breaching $1,850 levels, the precious yellow metal is facing strong resistance at $1,890 per ounce levels. On MCX, gold price has immediate support placed at ₹55,300 per 10 gm and it is facing immediate resistance at ₹56,200 and ₹56,700 per 10 gm levels.”

Dollar Index today opened upside and went on to add 0.23 per cent in morning deals and hit 104.668 levels, adding to the tune of 7.32 per cent in YTD time.

Fresh US economic data on Wednesday showed that America’s manufacturing contracted for a fourth straight month in February, but there were signs that factory activity was starting to stabilise, with a measure of new orders pulling back from a more than 2-1/2-year low.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.