US rate hike cools market

DOMESTIC REVIEW/ BULLION

Gold slipped both globally and locally as the dollar rose subsequent to the expected 25 basis point hike in US interest rates by the Federal Open Market Committee during the week.

The ongoing G-7 meeting in London will now set the direction for gold.

The New York Mercantile Exchange's Comex gold dipped as benchmark April fell to $415.80 per ounce.

The spot London gold fix closed at $415.90 from $426.80 (PM) last week.

Analysts predict a further drop in gold coinciding with the upcoming Chinese new year where the yellow metal traditionally slips.

Prices will stay weak for the next quarter before rising.

In Indian markets, the week ending February 5 saw prices falling further from last week.

Spot gold (99.50 purity) in Mumbai closed at Rs 5975 per 10 gram from Rs 6125.

Spot gold (99.90 purity) closed at Rs 6010 after last week's Rs 6165. Spot silver (.999) closed lower as well at Rs 10320 from last week's Rs 10485 per kilogram.

Futures trading saw higher volumes with open interest indicating that investors are long on both gold and silver.

National Commodity Derivatives Exchange (NCDEX) February gold eased to Rs 5986 from last week's Rs 6166. Open interest and volume were at 799800 gram and 103500 gram respectively.

March gold closed at Rs 6030 from Rs 6195 with open interest and volume of 395400 gram and 65800 gram respectively.

NCDEX February silver closed at Rs 10062 from Rs 10273 last week. Open interest was 125295kg and volume of contract 23135.

March contract closed at Rs 10157 from Rs 10329 last week, with open interest of 55150 and a volume of 8305.

Multi Commodity Exchange of India (MCX) February contract expired on February 4 at Rs 5963 from Rs 6120 with an open interest of 201 kg, and a volume of 95 kg.

April closed at Rs 6012 from last week's Rs 6164 with open interest of 3779 kg and a volume of 3779 kg. June closed at Rs 6035 compared with last week's Rs 6181 along with an open interest of 42 kg.

March gold HNI (High Net Worth Individuals) contract closed at Rs 6075 from last week's Rs 6117 with open interest and volume of 9 kg each.

HNI silver March closed at Rs 9670 from Rs 9834 last week, with an open interest of 3300kg and 3600kg of volumes traded.

March 4 silver contract rose to Rs 10094 from Rs 10279 last week. The open positions stood at 315720kg and the volume of contract was 54540 kg.

The May contract traded at Rs 10153 from the previous week's close Rs 10327, with 11160 kg positions open and volume of 1110 kg.

The July silver contract closed at Rs 10145 up from Rs 10352 last week with open interest of 360kg and a volume of 60kg.