Gold prices in India traded lower on the Multi Commodity Exchange (MCX) Wednesday amid a firm US dollar index and as investors awaited the Federal Reserve’s monetary policy decision, analysts said.

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At 11:30 am, gold futures for February delivery fell 0.52 percent to Rs 48,885 per 10 grams as against the previous close of Rs 49,143 and opening price of Rs 48,903 on the MCX. Silver futures traded 0.42 percent lower at Rs 66,258 per kg. The prices opened at Rs 66,231 as compared to the previous close of Rs 66,535 per kg.

“The gold prices declined as the dollar stabilized. There is a profit booking in gold and silver prices ahead of a policy announcement from Federal Reserve. However, concerns over coronavirus infection cases and expectations of US stimulus package will limit the downside in the precious metals,” said Ajay Kedia, director, Kedia Commodity Comtrade.

International gold prices edged lower on Wednesday, weighed by a firmer dollar, as markets awaited the US Federal Reserve’s monetary policy decision and developments around a stimulus package in the world’s largest economy, a Reuters report said.

Spot gold dipped 0.2 percent to $1,846.42 per ounce. US gold futures eased 0.3 percent to $1,845.30.

The US central bank is expected to stand pat on policy. Market participants will be watching for comments from Fed Chair Jerome Powell for clues on the state of the economy. An easy monetary policy adds pressure on government bond yields and benefits non-yielding gold.

The dollar rose 0.1 percent, making gold expensive for holders of other currencies.

According to Kedia, the trend for gold is expected to be sideways to negative.

“On MCX, gold may find support at Rs 48,620 level while resistance is placed at Rs 49,180 level. Support for silver is seen at Rs 65,560 level and support at Rs 67,050 level,” Kedia said.

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First Published:Jan 27, 2021 11:42 AM IST