Silver Pressured By Weak Sentiments In Global Markets: April 16, 2012

Spot silver prices came under pressure taking cues from weak sentiments in the global markets coupled with mixed movement in base metals pack.  However, further declined was not witnessed due to weakness in the US  Dollar Index.

The white metal touched a low of $31.14/oz in the last  week. On the MCX, Silver May contract slipped around 0.3 percent as a  weaker rupee resisted further fall on the domestic bourses and touched a low of Rs55,601/kg during the week.   

On a week-on-week basis, holdings in the iShares Silver Trust, the world's  largest silver-backed exchange-traded fund, declined around 0.8 percent to 9,591.39 tonnes on 13th April 2012 from the previous 9665.38 tonnes on 5th   April 2012.

Gold and silver are expected to trade lower today on account of strength in the US Dollar Index coupled with a rise in risk aversion in global markets.

Silver being an industrial metal will also take cues from downside in base  metals. However, further decline on the MCX will be cushion due to a  weaker rupee.

Gold Gains Trimmed By Unfavourable China Data

On a weekly basis, spot gold prices ended higher by more than 1 percent  and hit a high of $ 1679/oz during the week.

In the initial part of the  week, the yellow metal prices rose as sharp decline in equities led to  safe-haven buying in gold market and China’s annual inflation  which hiked to 3.6 percent in March also fueled inflation-led demand for  gold.

Additionally, weakness in the US Dollar Index also acted as a further  supportive factor for the yellow metal prices. However, in the later part  of the week, unfavorable GDP data from China trimmed most of gains in  gold prices.
 
On the MCX, Gold June contract gained by 1.8 percent and touched a  high of Rs.28,815/10 gms during the week. The Indian rupee depreciated around 0.8 percent in the same period and a weaker rupee led further gains on the domestic platform.
 
Holdings in the SPDR Gold Trust, the world's largest gold-backed  exchange-traded fund, slightly declined to 1,286.17 tonnes by 13th April 2012 from the previous level of 1,286.62 tonnes on 5th  April 2012.

While on a year-to-date basis, gold holdings rose by around 2.5 percent from  the previous level of 1,254.57 tonnes on 31st December 2011.