Tuesday, August 11, 2015

Fed September rate hike doubts power Bullion rally

The yellow metal notched up handsome gains in the domestic market on Monday as investors and speculators booked fresh positions in the precious metal as a Fed official hinted at a later rate hike than September, bolstering the lure for Gold as a store of value.US Federal Reserve Vice Chairman Stanley Fisher expressed uncertainty over the prospects of policy tightening in September amid stubbornly low inflation, stressing that the maiden lift-off in US interest rates since 2006 may not occur until inflation returns closer to the Fed’s 2 per cent target. The Fed’s preferred inflation gauge currently is at 1.3 per cent, way off the required mark.Meanwhile, while payrolls profit continued to top the 200K mark in July, wages remained nearly flat, bolstering the case to delay policy tightening.Weaker dollar also boosted the lure for Gold as an sustitudenal asset. Weaker greenback makes Gold loer priced for those holding other currencies, thus supporting demand.Gold may reverse gains today as the dollar resumed a march.

At the MCX, Gold futures for October 2015 contract closed at Rs 25,122 per 10 gram, up by 0.91 per cent after opening at Rs 24,885, against the previous closing price of Rs 24,895. It touched the intra-day high of Rs 25,199.

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