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Struggling dollar may cap gold’s gains

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A dollar struggling to keep its head up amidst the fiscal crisis that the US is facing is likely to cap gains in gold prices in the domestic market.

Though gold opened higher in Singapore on Monday morning, the euro and other currencies gained against the greenback. The euro, in particular, has been buoyed by Greece getting ample votes from its Parliament for Budget.

Any drop in the dollar will make imports of gold cheaper but currently, the yellow metal is witnessing festival and marriage season demand here. Besides, the precious metal is on the rise in the global market.

In Singapore, gold was quoted higher at $ 1,733.94 an ounce, while gold December contracts ruled up at $ 1,734.20.     

On Saturday, gold for jewellery (99.5 per cent purity) closed higher at Rs 31,650 for 10 gm, while pure gold (99.9 per cent purity) ended at Rs 31,800 per 10 gm in Mumbai.

The oils and oilseeds complex could continue to be in the grips of bears with prices dropping in Chicago Board of Trade’s electronic trade. Besides, the drop in dollar will make imports cheaper.

In early trade, soyabean for November delivery rule at $ 14.51 a bushel. Crude palm oil on Bursa Malaysia Derivatives exchange opened at one-month low on Monday morning.

Wheat and corn (industrial maize) are likely to feel the pressure of profit-booking and currency movements. Wheat for delivery in December was a tad lower at $ 8.86 a bushel, while corn for delivery the same month slipped to $ 7.39 a bushel.

Crude oil could see some upward movement after problems in Nigerian pipeline. Brent oil was up at $ 17 a barrel, while NYMEX crude ruled at 86.17 a barrel.

That could see natural rubber range-bound with an upper bias.

Cotton is likely to rule flat with cotton futures ruling flat at 69.75 cents a pound.

(This article was published on November 12, 2012)
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from:  vishaka
Posted on: Nov 12, 2012 at 15:53 IST
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