Gold could come under pressure after the dollar slid against a basket of other currencies early on Tuesday.
The greenback slid in Asian currency market on worries over a settlement on the fiscal crisis developing in the US. A better Chinese data and fears over the debt situation in Spain and Greece receding also played a role in dragging the US currency.
With investors selling the dollar, the Indian rupee also will stand to gain. Any rise in the rupee will make imports cheaper as India depends on buying gold from abroad to meet its demand.
In early trade spot gold traded flat at $1,715.14 an ounce, while gold futures for December delivery ruled at $1,715.90.
In the domestic market, gold for jewellery (99.5 purity) closed higher on Monday at Rs 31,400 for 10 gm, while pure gold (99.9) ended up at Rs 31,540.
The oils and oilseeds complex is likely to see range-bound trade as soyabean hit a three-week high. But the dollar’s downward movement could even out things. India imports nearly 10 million tonnes of vegetable oil, primarily palm oil, to meet its rising demand. A demand by the solvent extraction industry to imposed import duty on crude palm oil and palmolein may also act as a dampener.
On the Chicago Board of Trade, soyabean for delivery in January was up at $14.48 a bushel. On the Bursa Malaysia Derivatives Exchange, crude palm oil February contracts slid on Monday to 2,313 ringgit ($760) a tonne.
With export demand yet to realise into deals and US shipments being lower than last year, corn (industrial maize) and wheat prices dropped on CBOT overnight. This could have an effect in the domestic market since exports are being eyed from here.
Corn March contracts fell to $7.51 a bushel on the CBOT, while wheat for March delivery declined to $8.60 a bushel.
Worries over US fiscal deficit kept crude oil cool in the global market. Brent January contracts slipped to $111.08 a barrel, while NYMEX crude for January delivery quoted at $89.09 a barrel.
