Gold futures dip after US jobs data

Gold futures dip after US jobs data
Gold futures closed lower in the domestic market on Thursday as investors and speculators exited positions in the precious metal tracking a weak trend in the overseas market as stronger than expected US jobs data raised bets of continued QE taper by the Federal Reserve, dimming the appeal of the bullion, a hedge against the inflationary risk of monetary stimulus.

The US economy added 288,000 jobs in June, compared to 215,000 estimated by analysts.

Stronger dollar and a rise in equities dimmed the appeal of the precious metal as an alternative asset. Stronger dollar makes the bullion more expensive for those holding other currencies, thus dimming demand.

Gold futures may fall today amid speculation that the Fed may start tightening monetary policy sooner than earlier estimated after upbeat jobs data.

Gold futures for August 2014 contract, at MCX, closed at Rs. 27,464 per 10 grams, down by 0.72 per cent, after opening at Rs. 27,564, against the previous closing price of Rs 27,663. It touched an intra-day low of Rs 27,363.

Read more about: gold futures
Story first published: Friday, July 4, 2014, 12:40 [IST]
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