Gold on MCX settled down -0.22% at 31480 as recent upbeat economic data and signs that Washington and Beijing were making headway in a nearly year-long trade tariff skirmish boosted risk sentiment. Better economic conditions motivate investors to pivot towards equities that are interest-bearing assets and shun the non-yielding bullion.
Boston Fed President Eric S. Rosengren says the Fed is waiting for signals that indicate a sustainable 2% inflation trend. He also said he sees that unemployment is falling, adding that that he does not expect a recession. China reported better-than-expected credit and export figures last week that allayed concerns regarding the pace of economic growth. Meanwhile, jobs data from the United States last week also lifted sentiment, assuaging concerns that the largest economy was losing momentum.
Data showed the number of Americans filing applications for unemployment benefits dropped to a 49-1/2-year low. U.S. Treasury Secretary Steve Mnuchin told trade negotiations between the Washington and their Chinese counterparts were “making a lot of progress.” After hitting a roughly 14-month low around late March, U.S. benchmark 10-year and 30-year yields have risen about 17 basis points and 16 basis points respectively.
Markets now await key Eurozone and Chinese data, which will provide further clues on the global economic health. Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, on Monday dropped to 754.03 tonnes, their lowest since Nov. 9, 2018. Technically market is under long liquidation as market has witnessed drop in open interest by -0.69% to settled at 14149 while prices down -68 rupees, now Gold is getting support at 31406 and below same could see a test of 31332 level, And resistance is now likely to be seen at 31601, a move above could see prices testing 31722.
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