Gold prices concluded the trading session with a 0.44% increase, reaching Rs 153,765. This uptick was bolstered by diminishing expectations surrounding Federal Reserve rate hikes and reports indicating that China’s central bank augmented its gold purchases in July. Investors maintained their attention on the tensions in the Middle East, as well as the forthcoming U.S. inflation, retail sales, and consumer sentiment data. These factors could potentially shape the Federal Reserve’s perspective on interest rates in light of the recent lacklustre jobs report.
In July, gold sales at the Perth Mint experienced a month-on-month increase of 3.8%, totalling 30,871 ounces. This figure marks a three-month peak and reflects a substantial year-on-year growth of 41%. CFTC data indicated that speculative net-long COMEX gold positions rose by 12,070 contracts to reach 132,398 contracts for the week ending August 4. This increase reflects a robust bullish sentiment in the context of geopolitical uncertainty, inflation fluctuations, and central bank acquisitions.
Physical demand exhibited a mixed performance, as Indian discounts expanded to $47 per ounce, whereas Chinese premiums adjusted to a range of 3-5. London vault holdings rose by 0.77% month-on-month, reaching a total of 9,464 tonnes, with a valuation of $1.2 trillion. India’s net gold imports decreased by 23% year-on-year, totalling 98.1 tonnes in the June quarter, while domestic demand experienced a decline of 6%, amounting to 131.4 tonnes. Global gold demand held steady at 1,268.9 tonnes in the second quarter, bolstered by central-bank acquisitions totalling 289 tonnes, which represents a fivefold increase from the revised estimate for the first quarter.
Technically, the market continues to experience short covering, as evidenced by a 0.88% decline in open interest to 10,276 contracts, alongside a price increase of Rs 666. Gold is currently finding support at Rs 152,845, and a breach of this level may reveal Rs 151,925. On the upside, resistance is positioned at Rs 155,060; a sustained move above this level could catalyse additional gains toward Rs 156,355.
