Gold Falls Sharply as US Economic Data Improves

Gold futures fell in the domestic market on Friday as investors and speculators exited positions in the precious metal tracking a weak trend in the overseas market as faster than expected US economic growth last quarter vindicated the US Federal Reserve's decision to end bond buying while dampening safe haven demand for the bullion, and denting bullion's appeal as an inflation hedge.

Gold Falls Sharply as US Economic Data Improves
The US economy grew by an annualized 3.5 per cent in the July-September 2014 quarter, beating estimates of a 3 per cent gain.

Holdings in the SPDR Gold Trust, the biggest bullion-backed exchange traded product fell to a six year low, signaling weak investment demand for the precious metal.

Gold futures for December 2014 contract, at MCX, is trading at Rs. 26,345 per 10 grams, down by 0.97 per cent, after opening at Rs. 26,563, against the previous closing price of Rs 26,603. It touched an intra-day low of Rs 26,335. (At 11:36 AM).

Read more about: gold
Story first published: Friday, October 31, 2014, 12:50 [IST]
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