Gold, Silver Likely To Trade In Narrow Range This Week As Markets Await Key US Economic Data

New Delhi, Aug 2: Gold and silver are likely to trade in a narrow range this week as traders await a raft of economic data, including the US non-farm payrolls report, for fresh clues on the Federal Reserve's interest rate outlook, analysts said.

Investors will monitor purchasing managers' index (PMI) data from the US, the UK, the Eurozone and Japan. Focus will remain on July employment data from the US, comprising non-farm payrolls and the unemployment rate.

Globally, developments surrounding the US-Iran conflict and the stability of crude oil supplies through key shipping routes will remain important drivers of market sentiment, they added.

"MCX gold to trade in the Rs 1.40-1.44 lakh per 10 grams range in the near-term, with the directional move hinging on US macroeconomic data and evolving expectations around the Fed's policy path," said Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities.

On the domestic front, gold futures for August delivery fell by Rs 1,595, or 1.1 per cent, during the last week to close at Rs 1.41 lakh per 10 grams.

Silver futures for the September contract declined Rs 4,940, or 2.2 per cent, to settle at Rs 2.17 lakh per kilogram on the Multi Commodity Exchange.

"Gold remained volatile and ended the week on a weaker note, with MCX Gold declining a little over 1 per cent as prices continued to consolidate within a broad trading range," Trivedi said.

Despite a weak US dollar and a sharp correction in crude oil prices, gold failed to attract significant buying interest, indicating cautious investor sentiment, he added.

In the international markets, Comex gold futures for October delivery ended marginally lower at USD 4,076.6 per ounce, while silver for the September contract during the past week slipped nearly 2 per cent to finish at USD 57.78 per ounce in New York.

According to Trivedi, uncertainty over the Federal Reserve's interest rate outlook remained the primary factor weighing on bullion, as policymakers refrained from providing a clear timeline for future policy moves.

He noted that market participants will also track speeches by the Federal Reserve officials Lisa D Cook and Thomas Barkin, as well as China's trade data, including exports, imports, Consumer Price Index and Producer Price Index, for additional cues on the global economic outlook and bullion prices.

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