Gold future surges after touching 6 months low yesterday

Posted By: Religare
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Gold future surges after touching 6 months low yesterday
Gold futures gained after touching 6 months low in previous session. The metal faced a sell off yesterday after the disappointing Italy's bond auction. In international market, gold futures touched the 6 months low after bond auction, as Italy failed to reach the target of 8.5 billion Euros bond auction.

Further the yield of bonds is uncomfortably high for the world's fourth-biggest borrower, as Italy has to pay nearly 7 per cent to borrow at a 10-year bond auction. But, it rebounds on the back of buying support at 6 months low level in overseas market. At MCX, a Gold future for February contract is currently trading at Rs 27,144 up by 1.15 per cent. (AT 01.13 PM)

The recent concerns over Euro zone debt crisis led the Euro to fall to 15 months low against dollar, which made the precious metal expensive for the holders of other than dollar currency. The euro, on Thursday, declined against most of its major counterpart's on concern that the European Central Bank (ECB) will inject more cash into the financial system to avoid a credit crunch from the region's debt crisis.

The euro reached at 15-month low of 1.2855 against the U.S. dollar as Italy sold 7.02 billion Euros (US$9.06 billion) of debt due from 2014 to 2022, which was less than its original target of up to 8.5 billion Euros.

Dion Global Solutions Ltd

Read more about: gold, futures, mcx, dollar
Story first published: Friday, December 30, 2011, 22:30 [IST]
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