Gold futures fall amid QE tapering concerns

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Gold futures fell in the domestic market on Thursday as investors and speculators exited positions in the precious metal as robust US labour market data signaled a pickup in the world's biggest economy, boosting the case for the Federal Reserve to taper QE in the near-term, dimming the appeal of the yellow metal, which is a hedge against the inflationary risk of monetary stimulus.

The number of Americans who filed for unemployment claims fell last week while companies stepped up hiring in June, a sign that the US labour market recovery is picking up pace. US companies added 188,000 employees in June, up from 134,000 in the previous month while jobless claims fell 5,000 to 343,000 last week. Former Fed Governor Laurence Mayer said that the central bank may start scaling back its monthly asset buying program from September.

A stronger rupee also exerted downward pressure on domestic bullion prices, more than offsetting the gains witnessed in the bullion in the overseas market.

At the MCX, Gold futures, for the August 2013 contract, is trading at Rs 26,170 per 10 gram, down by 0.48 per cent, after opening at Rs 26,202, against a previous close of Rs 26,296. It touched an intra-day low of Rs 26,141. (At 10:20 AM).

Read more about: gold futures, precious metal, qe
Story first published: Thursday, July 4, 2013, 12:50 [IST]
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