- Created: Wednesday, 28 January 2015 11:51
Last week MCX Gold Feb future witnessed bullish movement of more than 1.5 percent and made the high of 28271 during the week. Bullish movement in Gold seen mainly due to buying by jewellers to meet wedding season demand and firming overseas trend. Economic and political uncertainties in the euro zone also pushed euro-denominated gold up to a peak level of 1,126.85 euros, highest since May 2013.
COMEX Gold future prices breached the psychological level $1,300 an ounce on Wednesday for the first time since August-2014 due to softer dollar, uncertainty over global economy and hopes of stimulus measures from the European Central Bank (ECB) which fuelled demand of bullions. Traders and investors were curious about the ECB policy meeting on Thursday, as it was widely expected by bank to unveil a quantitative easing (QE) programme. As expected, European Central Bank expanded stimulus measures, the bank will buy roughly 50 billion euros of government bonds a month from March until September 2016. Major US economical events released last week like Individuals filing for initial jobless benefit which is increased by 6,000 to 307,000 from estimates of 301,000 and lower than expected Building Permits to 1.03M from 1.06M also supported the Gold prices to trade upside. Holdings in the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, expanded 1.55 per cent to the highest level since Oct. 29 at 742.24 tonnes on Tuesday.
Silver tracked the trend of gold and witnessed bullish movement last week. MCX Silver sustained above 39000 for the entire week and showed bullish movement from lower levels with overall gain of around 2.8 percent on weekly basis. COMEX Silver also rebound from lower levels and sustained above its support level of $17.50.
Commerce and Industry Minister, Nirmala Sitharaman, hinted that Government of India may provide some incentives to the jewellery sector in the upcoming budget. Jewellery industry is one of the most highlighted focusing areas for “Make in India” drive. In pre-Union Budget recommendations, All India Gems and Jewellery Trade Federation (GJF) had urged the government to cut the duty on gold from 10% to 2% to encourage ‘Make in India’ initiative in the gems & jewellery sector. GJF also categorically urged the government to exclude jewellery from all bilateral or multi-lateral free trade agreements (FTAs) buy stating that the government should not encourage jewellery imports at cheaper rates, as it discourage indigenous jewellery manufacturing. Jewellers also want Jewellery manufacturing cluster to be revamped by including common facility centre and skill up-gradation.
This week, we can expect bullish movement in Gold MCX Feb futures & it can test the levels of 28500 – 28800 till the end of week. Similarly Silver is also looking bullish on the charts and MCX Silver March futures can test the levels of 41000 – 41500 on the higher side.
For this week, major U.S. like data Core Durable Goods Orders, CB Consumer Confidence, New Home Sales, Unemployment Claims and Advance GDP, coupled with physical demand in Asian region will further provide direction to the bullions.