Dollar declines as gold prices climb and U.S.Fed comments turn dovish; resistance is at Rs 53000

Gold rate was positive on Thursday as a result of positive global trends, while the silver rate was up 1.16%. The price of gold December futures on the Multi Commodity Exchange was up Rs 244 or 0.47% at Rs 52,695 for a ten-gram contract. Silver December futures were trading Rs. 715 higher at Rs. 62,345 per kilogram on the MCX. According to Reuters, as a result of the U.S. Fed’s policy meeting minutes suggesting a dovish strategy for future rate hikes, the yellow metal ended up above the crucial $1750 mark globally. In-flight gold increased 0.3% to $1,754.08 for an ounce. As of $1,754.30, U.S. gold futures had increased by 0.5%.

Bhavik Patel, Commodity and Currency Analyst, Tradebull Securities, told The FOMC meeting minutes were slightly dovish yesterday, which helped the price of gold. The possibility that the Fed might be tightening monetary policy beyond what is necessary alarmed some Fed officials. Silver and gold both benefited from the significant decline in the U.S. dollar. The fact that the Fed terminal rate is unchanged and some committee members expect the Fed Funds rate to end higher than anticipated presents obstacles notwithstanding the gain. We don’t expect any significant movements as gold is now trading at or above $1755 on the COMEX, and the U.S. stock market is closed today. Buy-on dips with a 52400 stop loss and a 52780 anticipated goal should be the intraday approach for today.

Navneet Damani, Sr. VP, Commodity & Currency, MOFSL, stated dollar dropped against its main crosses after the minutes of the Fed meeting suggested that the central bank was less aggressive than anticipated, which helped gold and silver prices recover from intraday lows. The Fed’s decision-makers “substantially majority” concurred that it would “likely soon be appropriate” to decrease the rate of interest rate increases.

The minutes also revealed a growing discussion within the Fed about the dangers that abrupt policy tightening would pose to financial stability and economic growth, even as decision-makers acknowledged that there had been little discernible progress on inflation and that rates still needed to rise. Due to the U.S. market being closed for the Thanksgiving holiday, volatility today may remain low throughout the afternoon. We anticipate that gold will trade favorably and quote between 52,450 and 52,980.

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