- Gold prices likely to trade within a narrow range amid dollar and bond yield concerns
- Investors await key economic data on manufacturing, services, and US housing reports
- MCX gold futures rose 1.04% last week, closing at Rs 1.54 lakh per 10 grams
Gold is set for another week of choppy trading, with prices likely to remain within a narrow range as investors weigh the direction of the dollar and government bond yields against renewed uncertainty over the West Asia conflict and oil markets.
With key monetary policy decisions and geopolitical developments now largely priced in, investors are turning to a fresh run of economic data for signals on the path for interest rates and the outlook for bullion demand.
Attention will turn to early readings on manufacturing and services activity across key economies, offering investors a fresh gauge of the global economic outlook.
US data on housing, durable goods orders and consumer sentiment, due later in the week, are also expected to influence market expectations on monetary policy and provide direction to gold prices.
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On the Multi Commodity Exchange (MCX), gold futures for October delivery rose Rs 1,597, or 1.04%, last week to settle at Rs 1.54 lakh per 10 grams. Silver futures gained Rs 6,629, or nearly 3%, to close at Rs 2.41 lakh per kg.
"MCX gold witnessed a weak opening last week near Rs 1.5 lakh per 10 gram but staged a strong recovery towards Rs 1.54 lakh per 10 gram as buying interest emerged at lower levels," Jateen Trivedi, research analyst - commodity and currency at LKP Securities, said.
He said the recovery came amid heightened volatility as markets assessed a combination of macroeconomic and geopolitical developments.
With key events now out of the way, market participants are likely to focus on expectations around the next phase of monetary policy and geopolitical risks.
In international markets, Comex gold futures for December delivery ended marginally higher at USD 4,424.9 per ounce, while silver gained around 3 per cent to USD 67.15 an ounce.
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"Gold futures continued to trade steady as prices consolidated for the third straight week, but some bargain buying was seen at corrective levels in last couple of trading sessions to close the week in positive," Pranav Mer, senior vice president, EBG - commodity & currency research at JM Financial Services, said.
Mer said the US dollar index and US Treasuries pared some gains, while oil prices reversed their mid-week movement.
He added that investor demand for gold has remained firm, with continued inflows into gold exchange-traded funds across markets over the past seven to eight trading weeks.
With major central bank events over, markets will also watch the People's Bank of China's monetary policy decision on Monday, with rates widely expected to remain unchanged.
(With PTI inputs)
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