Gold has failed to sustain its position as the 'safe haven' and instead has lost to "dollar" thanks to the higher than expected US GDP growth rate which has cemented the possibility of a rate hike in the month of September. Also the trade war situation is providing a boost to the greenback as the US President Trump is set to go ahead with tariffs on an additional $200 billion in Chinese imports.

In the international market, gold price has seen decline for the fifth straight month, marking the longest losing streak in half a decade since the year 2013. Gold priced in dollar terms has fallen by 7.7% in this calendar year while the MCX gold has shown a very feeble and unimpressive return of just around 3%.

The bullion in today's trade has remained largely flat at $1202.45 per ounce after striking 19-month low price on August 16.

Gold shares inverse relationship with interest bearing instruments as any likely interest rate hike in the economy pushes the demand for interest bearing instruments such as dollar. Also, at a time, when equities and yields across the world markets including the US and India are making new highs every other day, investors are likely to avoid gold. As per the UBS Group AG's wealth management unit, the US central banker is set to make 4 more rate hikes before pausing.

Also, the looming geo-political trade tension has failed to augur well for the yellow metal as it is expected to trigger a decline in the global growth nonetheless the situation does not points out to a crisis that shall spur buying in the metal and hence provide an impetus to the price of gold. So, at best the prices of gold will remain under pressure in the near term.

Gold in the domestic market may also not be able to sustain higher prices in the near term, though festive season demand may provide some momentum . In India, gold in 22k is priced at Rs. 29,670 up by Rs. 10 whereas 24k gold is available for Rs. 31,970 per 10 gm of gold.

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