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Flat finish for Bullion as Fed rate hike worries weigh

By Religare
|

The yellow metal ended little changed in the domestic market on Friday as traders stuck to a cautious stance ahead of the US Federal Reserve's highly anticipated two-day monetary policy meet beginning this Tuesday where the world's top central bank may offer fresh cues over when it plans to raise interest rates in the world's biggest economy for the first time since 2006.

Strengthening labour market amid payrolls gains topping 200K over the past several months and signs of a pickup in inflation have raised bets of an interest rate lift off in September, curbing the lure for the bullion as a store of value.

 

However, plunging stock markets supported Gold's appeal as an alternative asset. Wall Street succumbed to heavy losses on Friday with the Dow Jones Industrial Average posting its worst week since January as a China factory slump hit biotechnology & raw material producers, while gloomy earnings from technology giants also marred sentiment.

Gold may trade on a cautious note today as traders stay on the sidelines ahead of the FOMC meet this week and the release of US Q2 GDP numbers on Thursday.

At the MCX, Gold futures for August 2015 contract closed at Rs 24,731 per 10 gram, down by 0.01 per cent after opening at Rs 24,559, against the previous closing price of Rs 24,734. It touched the intra-day low of Rs 24,451.

Story first published: Monday, July 27, 2015, 12:40 [IST]
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