Gold, silver futures drop up to 0.5%. Here's what analysts said

NEW DELHI: Gold and silver futures fell up to 0.5 per cent in Friday's trade, despite the ECB pledge on bond buying and optimism over US stimulus.

Gold futures for April delivery fell 0.32 per cent to Rs 44,737 per 10 grams. Silver futures for May delivery were trading at Rs 67,207 per kg, down 0.50 per cent.

Globally, gold prices fell on Friday but were on course to mark their best week in seven, as easing U.S. Treasury yields and dollar lifted the metal's appeal.


Spot gold fell 0.3 per cent to $1,716.50 per ounce. Prices were up 1.4 percent for the week so far, their biggest jump since the week ended January 22.

Ravindra Rao of Kotak Securities said that gold has eased from recent highs as upbeat US economic data and approval of the US stimulus package brought a halt to recent correction in dollar.


"ETF outflows also show weaker investor interest. Gold may continue to sway along with the dollar, but general bias may be on the upside on US stimulus deal," Ravindra Rao said.

"Bullion counter may trade with bearish bias wherein gold may find support at Rs 44,500 and resistance at Rs 45,000 while Silver (May) may trade with higher volatility where it may find support at Rs 66,800 and resistance near Rs 67,900," SMC Global said.

US gold futures were steady at $1,723.10. Benchmark US Treasury yields pulled further down from a more than one-year peak hit last week, reducing the opportunity cost of holding non-interest paying gold.

On Thursday, the European Central Bank said it would accelerate money-printing to keep a lid on euro zone borrowing costs, signalling to sceptical markets that it is determined to lay the foundation for a solid economic recovery. Besides, the number of Americans filing new claims for jobless benefits dropped to a four-month low last week.

Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, fell 0.5 per cent to 1,055.27 tonnes on Thursday.