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Gold is set to make more headway in the domestic market on Friday as prices in the global markets ruled firm and the dollar gained against most currencies.
The re-election of US President Barack Obama has given rise to hopes that Washington will have a loose monetary policy, driving investors to bet on haven such as gold. Signs of recovery in the US job market are aiding a rally in the dollar against other currencies such as the Euro.
A strong dollar makes imports of the yellow metal costlier and with most betting on rise in the precious metal next week, gold’s rally is set to continue.
In early trade, gold was quoted higher at $1,732.25 an ounce, while gold for delivery in December ruled marginally higher at $1,732.60.
In the domestic market, gold for jewellery (99.5 per cent purity) ended up at Rs 31,200 for 10 gm on Thursday, while pure gold (99.9 per cent purity) finished higher at Rs 31,335.
SLIPPING VEGOILS
The oils and oilseeds complex is likely to come under pressure after soyabean dropped on the Chicago Board of Trade. This followed reports showing that demand for soyabean from the US, world’s largest exporter, dropped. However, a strong dollar could cap the fall since Indian imports a majority of its edible oil needs.
Overnight, soyabean for delivery in January slipped to $14.9575 a bushel. On Thursday, crude palm oil on Burasa Malaysia Derivatives Exchange declined to 2,328 ringgit ($760) a tonne.
GRAINS ON UPTREND
Grains could rise as wheat topped the $9-a-bushel-mark on CBOT. Wheat gained on speculation that the US Department of Agriculture report due later tonight would show supplies in the global market tightening.
US expects to garner a chunk of the tightening demand with Australia and Argentina facing a lower output. India, in turn, could also gain with a huge stockpile of over 40 million tonnes as stocks with the government-owned Food Corporation of India.
This will automatically put pressure on corn (industrial maize) as the feed industry could look increasingly at the coarse grain for meeting its needs. India could gain from possible demand from the Far-East and South-East Asia.
A rise in the dollar will make Indian exports competitive and this could also come in handy for the bulls to drive the counter up.
Wheat for December delivery increased to $9.02-1/2 a bushel but corn for delivery the same month slipped to $7.4125 a bushel.
Crude oil is likely to be range-bound on the higher side in view of the dollar’s rise. In New York, crude oil pared its losses overnight.
Brent crude oil for delivery in December, the global market benchmark, was up at $107.25 a barrel. NYMEX crude for delivery in December ended higher at $85.09 a barrel.
Consequently, natural rubber in spot and futures could be up marginally.
SOUR SUGAR
Sugar prices could head south after the counter plunged to a two-year low. That makes prospects for export of Indian sugar a little hard despite a drop in the rupee value.
Raw sugar for March delivery settled at 18.84 cents a pound, while white sugar in London for December delivery slipped to $525.90 a tonne.
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