Gold is likely to rule firm on the spot and futures market on Monday as China has reported that its economy grew slowly in the second quarter.
The gains in the bullion market will be, however, capped since this factor has been discounted last week after Chinese exports and imports fell. A factor that come to gold’s rescue is the 4.1 per cent rise in speculators' bet that gold will rise.
In early trade in Singapore, spot gold rose to $1,292.63 an ounce, while gold futures maturing next month quoted at $1,290.60.
In the domestic market on Saturday, gold for jewellery (99.5% purity) ended higher at Rs 26,775 for 10 g and pure gold (99.9% purity) at Rs 26,890.
Gold futures
On MCX, gold August contracts could rise to as high as Rs 26,800.
Currency moves could have some bearing on gold’s movement as a weaker rupee against the dollar will make import of gold, crude oil and vegetable oils costlier.
Crude oil
Crude oil is set to rule range-bound on the back of Chinese growth data.
Brent crude oil August contracts ruled at $108.87, while West Texas Intermediate oil contracts for the same month quoted at $105.99 a barrel.
The oils and oilseeds complex could see bear’s domination on Monday on projections of favourable weather for the US soyabean crop and peak palm oil tapping season in South-East Asia.
Soyabean, crude palm oil
Chicago Board of Trade (CBOT) soyabean November contracts ruled lower at $12.60 a bushel, while crude palm oil September contracts fell to 2270 ringgit ($715) a tonne.
The grains complex is also likely to be under pressure on weather forecast for corn (industrial maize). A weather that will aid better growth of crop has been projected for the US Midwest where corn is the dominant plant. Wheat may also follow corn’s way.
CBOT corn for delivery in December slipped to $5.06 a bushel, while wheat for delivery in September fell to $6.76 a bushel.