After a sharp jump in the previous session, gold prices declined in India today while silver also declined. Gold down 0.35% on MCX ₹47,102 per 10 g after growing ₹400 in the previous session while silver fell 0.4% ₹63,332 per kg. in global markets, Sleep The dollar remained in a narrow range near the crucial $1,800 level as the dollar made some correction after a fall driven by US inflation data. Spot gold was down 0.2% at $1,800, down from its one-week peak of $1,808.50 on Tuesday. A strong dollar makes gold more expensive for holders of other currencies.
“As a result of weaker-than-expected growth in US inflation, international gold prices are trading above $1800, increasing confusion about the Federal Reserve’s program to initiate asset cuts. On the domestic front, MCX Gold Oct. Slightly lower again at 47246, trading with a sideways momentum with a slight bearish trend. In the previous session, prices fell below 46700 for the first time in almost a month before rallying higher ₹Closed from 500 to 47293. The market bounced off the support levels and we can expect the bulls to dominate the evening session,” CapitalVia Investment Advisor said in a report.
Data released Tuesday showed US consumer prices rose in August at the slowest pace in six months. Gold is seen as a hedge against inflation, but hopes the Fed may be slow on unwinding stimulus measures, which helped gold’s appeal.
Gold traders will now keep an eye on the Fed’s two-day monetary policy meeting next week to get more signals on tapering.
Among other precious metals, silver fell 0.3% to $23.77 an ounce, while platinum fell to a nine-month low of $925.50.
“Gold may see choppy trade reflecting US dollar trend as market players assess the Fed’s monetary policy stance and China’s economic health. However, rising challenges to the global economy may support prices,” Kotak Securities said in a note.
“Among other factors, gold ETF investors parted ways earlier this week after brief inflows. Gold holding with SPDR ETF remained unchanged at 1000.21 tonnes yesterday. However, gold prices are supported by sustained virus risks, mixed economic data from major economies, inflationary concerns, regulatory action measures by China and heightened geopolitical tensions. According to the latest WHO update, there have been nearly 4 million new cases globally in the past week (6-12 September), the first major drop in weekly cases in more than two months. (with agency input)
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