Friday, July 31, 2015

Gold futures ended on a lackluster note

Gold futures ended on a lackluster note in the domestic market on Thursday as investors and speculators stayed on the sidelines as a stronger dollar curbed the appeal of the precious metal as an alternative asset.Stronger greenback makes Gold more expensive for those holding other currencies, thus dimming demand.Gold was also pressured by fears over near-term interest rate tightening by the US Federal Reserve as strong GDP numbers signaled an improving health of the world’s biggest economy.The American economy expanded at an annualized pace of 2.3 per cent in the June quarter following a revised 0.6 per cent gain in Q1, with consumer spending, the main growth driver, rising at a 2.9 per cent pace, compared to a 1.8 per cent advance in the March quarter.The Fed on Wednesday signaled further strength in the US labour and housing markets, leaving the door open for a maiden interest rate hike since 2006, over its coming meetings.Gold which doesn’t earn any interest tends to lose out against competing assets in a rising interest rate scenario.The bullion may trade on a cautious note today as investors’ eye key US economic data including consumer sentiment and Chicago business activity index, offering latest cues over the health of the country’s economy.

At the MCX, Gold futures for August 2015 contract closed at Rs 24,718 per 10 gram, unchanged after opening at Rs 24,737, against the previous closing price of Rs 24,720. It touched the intra-day low of Rs 24,565.
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