Moderate Gains For MCX Gold, Silver, Traders Eye FOMC Minutes

Moderate Gains For MCX Gold, Silver, Traders Eye FOMC Minutes 

Gold is trading steady in Asia today after slumping yesterday. COMEX Gold dropped morethan 2% to test its six month lows near $1200 per ounce as he lack of resolution on thetalks between the Greek government and its Eurozone creditors hit the sentiments. Thetraders sold gold ahead of the minutes of the last meeting of the Federal Reserve’spolicy setting committee, due to be released on Wednesday. Gold has been supported in lastfew days though the latest slide has put a question mark on the ability of the commodityto record significant gains following a massive correction last year. COMEX Gold isquoting at $1210 per ounce, up $1.40 per ounce on the day. MCX Gold futures are trading atRs 26334 per 10 grams, up Rs 115 per 10 grams on the day. MCX Silver futures are tradingat Rs 36630 per kg, up Rs 256 per kg on the day.

The latest figures from World Council (WGC) indicated that the gold demand around theworld picked up in Q4 2014 though overall interest in physical gold remained mutedfollowing a massive slide in Jewellery demand. The sentiments remained supportive in Asiatoday following continued worries over Greek debt jitters. COMEX Gold trades at $1233 perounce, up $6 per ounce on the day. MCX Gold futures are trading at Rs 26813 per 10 gramsup Rs 122 per 10 grams on the day. MCX Silver is trading at Rs 38260 per kg, up Rs 56 perkg on the day.

According to latest data out from the Ministry of Commerce and Industry, India’sgold imports surged 8.13% over year to US$1558.40 million in January 2015. Silver importsalso soared 29.20% to US$381 million in January 2015. Indian demand for gold jewelleryrose by 8% to 662 tonnes in 2014 - making it the best year of jewellery demand sincerecords began in 1995, the WGC stated in its latest gold demand trends update. However, onthe whole, the Indian gold demand stood at 842.7 tonnes in 2014, down nearly 14% after arecord performance in 2013.

Meanwhile, the global gold market ended 2014 on a strong footing, according to a latestupdate from the World Gold Council (WGC). Q4 demand grew from 930.0t to 987.5t (+6%).However, the annual total of 3,923.7t was down 4% year-on-year – not surprising asconsumer demand in 2014 was never likely to match 2013’s record surge says the WGC.Jewellery demand was down 10% to 2,152.9t, but 5% above its five-year average. Investmentrose 2% to 904.6t, although bar and coin fell from the 2013 record. Central banks bought477.2t, close to a 50-year high.

Meanwhile, gold speculators continue to retreat. Large futures traders and goldspeculators sharply cut back on their overall bullish bets last week as positionsdecreased for a second straight week, according to the latest Commitment of Traders (COT)data released by the Commodity Futures Trading Commission (CFTC) on Friday. Thenon-commercial futures contracts of Comex gold futures, traded by large speculators andhedge funds, totaled a net position of +155,274 contracts in the data reported throughFebruary 10th.

This was a weekly change of -29,741 contracts from the previous week’s total of+185,015 net contracts that was registered on February 3rd. The drop in the net speculatorpositions (-29,741 contracts) was due to a decrease in the weekly bullish positions by-29,970 contracts that offset a decline in the gold bearish positions by just -229contracts. The fall in the gold speculative positions has now overall positions to the lowest level in five weeks.