Coronavirus: Gold rebounds ahead of FOMC meeting

Indian June Futures rebounded on April 29 tracking gains in the international spot prices which were trading higher as the dollar weakened amid plans to ease major economies out of the coronavirus lockdowns.

Investors awaited any forward guidance from the US Federal Reserve's policy statement due later in the day.

“The Fed, which has responded to the current crisis by slashing interest rates, resuming bond-buying and backstopping credit markets, is scheduled to issue a policy statement later today and could begin to clarify how long it intends to leave rates near zero,” Reuters reported.

On the Multi Commodity Exchange (MCX), June gold contracts were trading higher by 0.06 percent at Rs 46,095 per 10 gram at 09:30 hours. Silver futures were trading nearly 0.55 percent higher at Rs 41,940 per kg.

Gold and silver prices settled slightly negative on Tuesday after a volatile session. Gold futures contract at Comex division slipped below $1,720 per troy ounce and silver futures contract also test $15 per troy ounce.

At MCX, Gold prices tested a low of 45,576 and settled above 46,000 levels. Silver also test lows of 41,150 and settled around 41,650. Despite downbeat US trade balance and consumer confidence data, both the precious metals show some weakness on Tuesday.

“Ahead of the US Federal Reserve policy meet some profit-taking is seen in both the precious metals. Less chance of further rate cuts from the Fed keep both the precious metals remain volatile on Wednesday,” Manoj Jain, an independent market expert told Moneycontrol.

“Gold is expected to trade in the range of 45,700-46,330 either side breakout of the range will give further direction. Silver prices are expected to move in the range of 41,300-42,100, either side breakout of the range will give further direction to the commodity,” he said.