Gold prices are likely to be range-bound on Wednesday as the dollar tended to be defensive against a basket of currencies, hoping for a solution to the US fiscal crisis. The expectation also weighed on gold, despite earlier hopes of a US Fed Reserve meeting coming up with measures to boost the economy.
Spot gold edged up in Singapore to $ 1,708.20 an ounce, while gold futures for February delivery ruled at $ 1,710.10.
In the domestic market, gold for jewellery (99.5% purity) ended lower at Rs 31,380 for 10 gm and pure gold (99.9% purity) at Rs 31,520 on Tuesday.
The oils and oilseeds complex could come under pressure after soyabean on the Chicago Board of Trade (CBOT) dropped last night. This was in line with a plunge in grain prices. Wheat prices hit a five-month low after the US Department of Agriculture said supplies in the domestic market would be more that initially expected.
Overnight, soyabean for January delivery slipped to $ 14.71 a bushel. Concerns over record stockpiles of palm oil in Malaysia and Indonesia are also weighing in on the market. It resulted in crude palm oil February contracts dipping to 2,292 ringgit ($ 750) a tonne on Bursa Malaysia Derivatives Exchange.
Wheat March contracts on CBOT dropped to $ 8.21 1/2 a bushel and corn (industrial maize) contracts for the same month fell to $ 7.28 a bushel.
A statement from Organisation of Petroleum Exporting Countries (OPEC) that its members production of crude was lower in November heated up crude oil.
Brent crude, a benchmark for India, for delivery in January was up at $ 108.01 a barrel, while NYMEX crude futures rose to $ 85.79.
A rise in crude oil prices could see natural rubber gain since its alternative synthetic rubber, derived from crude oil, will rise.