Our MCX Tips Experts assumed that Gold futures were likely to find short-term support at USD1, 706 a troy ounce, the low of December 6 and resistance at USD1, 760, the high of December 8.Though, gold futures have inclined to move in line with stocks and other industrial commodities in recent weeks, with investors moving in to cash as a safe bet amid ongoing global financial turmoil and economic uncertainty. The lender further expects that gold prices to remain 'on the defensive' in the near-term, citing growing evidence of a 'liquidity squeeze" in financial markets and as traders 'close books to lock in profit before the end of the year', reducing liquidity in the market and increasing the volatility.

The ECB cut its level interest rate by 0.25%, bringing rates back to a record low of 1%. Elsewhere on the Comex, silver for March delivery settled at USD32.25 a troy ounce by close of trade on Friday, slumping 1.22% on the week, while copper for March delivery settled at USD3.572 a pound, shedding 0.35% over the week.

In the week ahead, investors will keep a close eye on the borrowing costs of troubled euro zone states, as a rise in bond yields could prompt a rating cut after Standard & Poor's warned that it may carry out a mass downgrade of 15 euro zone members. The Official data shows that the consumer price inflation rose 4.2% in November, the smallest gain in 14 months, easing sharply from 5.5% in October. The data boosted assumption that further monetary easing measures in the near-term to help bolster growth in the world's second biggest economy.

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