Gold On MCX Settled Up 0.58%

Gold on MCX settled up 0.58% at 29623 as the dollar fell to a one-week low after the new U.S. Treasury chief poured cold water on the "Trumpflation trade" that had boosted the greenback this year. Treasury Secretary Steven Mnuchin said that any steps U.S. President Donald Trump's administration takes on policy would probably have only limited impact this year, though he wants to see tax reform passed by August.

The comments suggested much work was still needed on the sweeping tax plan that Mnuchin called his main priority, and which investors had bet would stoke growth and inflation this year. Tempering gains in bullion, a poll on Friday suggested French presidential candidate Emmanuel Macron would beat far-right leader Marine Le Pen, who has promised a referendum on European Union membership. 

Key global stock markets fell as investors scaled back bets that Trump's policies would benefit economic growth. Holdings of the largest gold-backed exchange-traded fund, New York's SPDR Gold Trust have risen more than 5 percent this month on geopolitical risk. Gold demand in Asia remained sluggish this week as a price rally on political concerns and dollar weakness kept buyers on the sidelines. 

Traders said both retail buyers and jewellers were hesitating to chase higher prices in India, the world's second-largest consumer of the metal. Dealers in India were charging a premium of up to $1 an ounce in the week over official domestic prices, compared with a discount of $1 last week. 

Technically market is under short covering as market has witnessed drop in open interest by -0.68% to settled at 6840 while prices up 172 rupees, now Gold is getting support at 29539 and below same could see a test of 29456 level, And resistance is now likely to be seen at 29677, a move above could see prices testing 29732.

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Suhani Verma

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