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Gold is likely to rule range-bound in the domestic spot and futures market on Wednesday as investors and traders await the outcome of the two-day US Federal Reserve meeting that ends later tonight.
A mixed data is engaging the market’s attention and any euphoria over the Fed continuing its $85-billion-a-month stimulus package will only be short-lived.
Last night, the US consumer spending data showed encouraging signs but car sales dropped, raising a question mark over economic recovery.
Easing of gold import rule
Gold holdings in SPDR Trust, world’s biggest, were unchanged at 872.02 tonnes. Some good news for India was the Government considering easing the rule for gold imports that requires 20 per cent of each imported consignment to be exported. That could bring down the premium and help improve offtake.
On Tuesday, gold dropped from a five-week high mainly since the dollar gained. Any rise in the dollar makes gold cheaper since it is the main currency in which the precious metal is traded.
Spot gold, gold futures
Around noon in Asia, spot gold quoted at $1,341.26 an ounce and gold futures to be delivered in December at $1,341.
In the domestic market on Tuesday, gold for jewellery (99.5 per cent purity) fell to Rs 31,295 for 10 gm and pure gold (99.9 per cent purity) to Rs 31,440.
On MCX, gold December contracts could trade between Rs 30,250 and Rs 31,000.
US crude oil stockpiles
Rising crude oil stocks in the US, a sign of weak economy, are likely to put pressure on prices.
Brent crude for delivery in December dropped to $108.66 a barrel and US crude to $97.63 a barrel.
Oils, oilseeds
The oils and oilseeds complex is likely to rule firm on demand for US soyabean and soyameal. China is showing good appetite to buy the bean from the US.
Reports from Malaysian plantations are not encouraging either as rains have affected palm oil production.
Chicago Board of Trade soyabean for delivery in January ruled at $12.75 a bushel. Crude palm oil contracts maturing in January topped $800 a tonne to rule at $803 or 2,537 ringgit at the opening on Bursa Malaysia Derivatives Exchange.
Wheat, corn futures
The grain complex could see some rally as investors, who have gone short, are likely to cover their positions in corn (industrial maize). Wheat, on the other hand, could rise on rains affecting harvest in Russia, which has also raised its offer price to $280 f.o.b.
Demand for US wheat is also keeping the counters up. CBOT corn contracts maturing in December quoted at $4.32 a bushel and wheat contracts for the same month ruled at $6.82 a bushel.
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