1 day ago
Gold Falls Nearly 1% as Strong Dollar Weighs on Prices
Gold prices in India went down on Monday.
A December gold contract on the MCX lost Rs 1,020 and traded at Rs 1,49,370 per 10 grams.
Gold had also fallen during the previous week.
Analysts said the strong US dollar and high US bond yields were making it harder for gold prices to rise.
Overseas, gold was trading a little higher than before, after briefly passing USD 4,200 per ounce on Friday.
A weak US jobs report had raised hopes that the Federal Reserve might not raise interest rates in October.
Investors were still watching for a possible rate increase in December.
Upcoming economic reports and uncertainty involving the US and Iran could also affect precious-metal prices.
MCX December gold fell Rs 1,020, or nearly 1%, to Rs 1,49,370 per 10 grams on Monday.
Gold had declined Rs 2,887, or 2%, during the holiday-shortened previous week.
Analysts said a strong US dollar and elevated Treasury yields were limiting gold’s recovery.
International December gold futures traded slightly higher at USD 4,163.50 per ounce after briefly topping USD 4,200 on Friday.
Investors were watching upcoming economic data and the unresolved US-Iran situation for possible market cues.
- Who
- Gold traders and investors; analysts quoted include Kaveri More, Akshat Siddhant and Manav Modi.
- What
- Indian December gold futures fell nearly 1% to Rs 1,49,370 per 10 grams.
- Where
- Multi Commodity Exchange of India; international futures traded in New York.
- When
- Monday; the article does not specify a calendar date.
- Why
- A stronger US dollar and elevated US Treasury yields were reported as limiting gold’s recovery.
Factors Supporting Gold
Factors Pressuring Gold
Economic and market signals
Factors Supporting Gold
A weak US jobs report supported overseas gold and reduced expectations of an October Federal Reserve rate hike to below 20%, according to Akshat Siddhant.
Factors Pressuring Gold
A strong US dollar and elevated Treasury yields were limiting gold’s recovery, analysts said; investors were still pricing in nearly a 70% chance of a December rate hike.
Key facts
- MCX December gold
- Rs 1,49,370 per 10 grams, down Rs 1,020 on Monday
- Previous week
- Gold fell Rs 2,887, or 2%, in domestic trading
- International December gold
- USD 4,163.50 per ounce, marginally higher in New York
- Dollar index
- Near an 18-month high of 102.37
- US 10-year Treasury yield
- Around 5.2%, according to Manav Modi
- International weekly move
- Gold fell USD 158.9, or 3.7%, to USD 4,162.3 per ounce; silver fell USD 4.38, or 6.7%, to USD 60.41
- Market cues cited
- Services PMI data, US trade figures, consumer sentiment data and the unresolved US-Iran situation
Quotes
Kaveri More
Commodity Technical Analyst at Choice Broking
“Gold prices have remained in a consolidating phase as a stronger US dollar and elevated bond yields continue to limit upside momentum.”
deccanchronicle.com
“Gold therefore remains caught between cooling labour conditions and persistent yield and dollar pressures.”
deccanchronicle.com
Sources
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