For gold, no news is good news! The yellow metal not only maintained status quo but resisted all attempts to push it lower as it came back to within a whisker of the $1,560 per ounce mark. It held firm even as news about lower gold demand and output of gold emanated from China.
The Indian situation was no different as that was coupled with lower GDP growth rates in the two biggest physical markets. Then, with neither the Bank of Japan nor the Bank of Canada touching their interest rates, gold was left to fend for itself.
Gold was fairly buoyant in early trading and it pushed on to scale $1,558.10 per ounce (London am fix). It declined during the day as it faced headwinds and closed in London at $1,556.90 per ounce (London pm fix).
Gold now appears unable to take any advantage from geopolitical tensions in the middle-east. However, in New York trading the yellow regained its proximity with the $1,560 per ounce levels and closed at $1,559.50 per ounce as it even withstood the Dow Jones surge and a stronger US dollar.
In early morning Asian trading the yellow metal was closer to $1,563 per ounce on the 23rd. Gold now looks at the ECB stance on interest rates on the 23rd as well as the Chinese New Year on the 25th for further impetus.
In the domestic market, gold opened with a loss of Rs.72 at Rs.39,942 per 10 gms. However, with both the BSE Sensex and the Nifty declining in the last three days and rupee too weak against the US dollar, gold ended higher at Rs.40,076 per 10 gms.
International trends could see gold opening higher in Mumbai. Silver, in contrast, opened sharply lower by Rs.515 at Rs.45,895 per kg. Although, it recovered during the day the white metal was still down by Rs.300 to end at Rs.46,110 per kg.