Gold futures closed higher in the domestic market on Thursday as the dollar consolidated and investors weighed the implications of a U.S. tax overhaul that passed Congress a day earlier.
Financial markets around the globe largely put up a muted response to the passage a day earlier of U.S. tax cuts with potential benefits to company bottom lines. The long-anticipated tax change was mostly priced in.
As per reports, tax changes offer a mixed bag for the metal. Some analysts have noted the increased risk of inflation, against which gold can act like a hedge, if the law supercharges the economy and forces the Fed to ramp up its rate-tightening efforts. On the other hand, tax-fueled gains in U.S. stocks and other risk-on markets had helped to drive gold to five-month lows earlier this month.
At the MCX, gold futures for February 2017 contract ended at Rs 28497 per 10 grams, up by 0.01 per cent, after opening at Rs 28,502 against a previous close of Rs 28,493. It touched the intra-day high of Rs 28,550.