Wednesday, August 26, 2015

Gold News Updates

Gold futures snapped a rally on Tuesday as a sharp rebound in the dollar made the precious metal less attractive for those holding other currencies.The yellow metal plunged to end at near a one-week low in the overseas market on Tuesday as a stronger greenback dimmed the lure for the bullion as an alternative asset.Worries over China eased a bit after the country’s central bank unleashed fresh monetary stimulus to help revive confidence among investors and arrest a steep rout in equities and help prevent the world’s second biggest economy from falling off a cliff, curbing the appetite for Gold as a safe haven asset. China cut interest rates by 25 basis points with the key lending rate now at 4.6 per cent while the bank reserve ratio was slashed by 50 basis points.

Meanwhile, mostly upbeat US economic data including a surge in July new home sales, solid services growth in August and a jump in consumer confidence this month signaled the strong progress made by the world’s biggest economy, backing up the case for an uptick in interest rates by the Fed sometime this year, dimming the appeal of Gold as a store of value.Gold may rebound today as markets in China extended the steepest four-day rout since 1996 despite fresh policy easing measures.

At the MCX, Gold futures for October 2015 contract closed at Rs 26,740 per 10 gram, down by 2.60 per cent after opening at Rs 27,300, against the previous closing price of Rs 27,448. It touched the intra-day low of Rs 26,662.

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