Gold and silver prices were trading higher on the Multi Commodity Exchange (MCX) on Tuesday, September 8, as a weaker US dollar lent support to global precious metal prices. Eyes are now on the upcoming US inflation data, which could offer fresh clues about the Federal Reserve's next move on interest rates.
At 9:54 am, MCX gold October futures were at Rs 1,53,992 per 10 grams, up Rs 1,174, or 0.77%, from the previous close of Rs 1,52,818. The contract had moved between Rs 1,53,361 and Rs 1,54,125 during the session.
Silver was also trading higher, with MCX December futures rising Rs 2,475, or 1.04%, to Rs 2,41,491 per kg. The contract had touched a low of Rs 2,40,009 and a high of Rs 2,41,724 by 9:55 am.
Gold, Silver Rise As Dollar Weakens
Domestic bullion market tracked the recovery in international precious metals. Spot gold was up 0.6% at $4,429.89 an ounce, while silver gained 1% to $66.78 an ounce on Tuesday.
The US dollar index was down 0.4%, making dollar-priced gold more affordable for buyers holding other currencies.
Gold had fallen in the previous two sessions after stronger-than-expected US job growth in August increased expectations of a possible Federal Reserve rate hike this month. Higher interest rates typically reduce the appeal of non-yielding assets such as gold.
US Inflation Data In Focus
The next major trigger for bullion prices is US inflation data. The producer price index is due on Thursday, followed by the consumer price index on Friday. The readings could influence expectations around the Federal Reserve's policy decision on Sept. 15-16.
Traders are currently pricing roughly a 60% probability of a US rate hike at the upcoming meeting, according to the CME FedWatch Tool cited by Reuters.
For Indian bullion prices, movements in global gold and silver, the dollar and the rupee will remain key near-term factors.
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