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Gold declines sharply on FED minutes report

Gold declines sharply on FED minutes report
Gold dropped 1% on Friday after the US Federal Reserve minutes of meeting revealed disagreement on how long the central bank should buy bonds.

It seems gold has lost its safe haven appeal as investors are shifting their investments from gold to dollar.

On the other side, dollar continues to head up against all major currencies, which is also another setback for the price of gold as it turns expensive for nations to buy gold.

International spot gold was seen trading at $1,646 an ounce. The report dimmed the charm of precious metal which is considered as hedge against inflation at the time of uncertainties.

Domestically, gold futures for February delivery on MCX which opened at Rs 30,925 per 10 grams was trading at Rs 30,713, lower by Rs 232 or 0.75% per 10 grams around 1.50 pm IST.

Silver futures registered a steep fall, following gold by shedding Rs 1,645 per kg.

Gold also fell as investors reduced their positions tracking weak overseas trend.

The metal outlook may dip more this week if negative sentiment continues among the global investors.

Read more about: gold silver mcx
Story first published: Friday, January 4, 2013, 14:09 [IST]
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