Gold futures lower ahead of ECB rate decision

Gold futures were trading lower in the domestic market on Thursday as investors and speculators stayed cautious ahead of the monetary policy decision of the European Central Bank (ECB) today. While calls for a rate cut have got louder amid weak inflation, the ECB may instead chose to loosen lending conditions. Gold tends to receive support from loose monetary policy conditions, given that the bullion is a hedge against the inflationary risk of monetary stimulus.

Investors were also eying the US jobless claims and factory orders data to be released today and which may offer further cues over the health of the world's biggest economy.

However, easing concerns over the crises in Ukraine has dimmed the safe haven appeal of the bullion. Gold futures for April 2014 contract, at MCX, is trading at Rs. 30,065 per 10 grams, down by 0.31 per cent, after opening at Rs. 30,082, against the previous closing price of Rs 30,158. It touched an intra-day low of Rs 30,031 (At 11:14 AM).

Dion Global Solutions Ltd.

Story first published: Thursday, March 6, 2014, 12:44 [IST]
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