The gold prices in India edged up following global cues amid weak equities market in India. The gold rates in India were seen at Rs 3,156 per gram for 22 karats, up by Re 3 per gram and at Rs 3,273 per gram, up by Re 4 per gram for 24 karats.
The yellow metal gained strongly in the overseas market after the U.S. Federal Reserve's decision to slow down on interest rate hikes during fiscal 2019 and 2020. The Central Bank of U.S. had announced four interest rate hikes in fiscal 2018 backed by strong U.S. economy and the mighty dollar.
The slowdown of global economic growth has prompted the Fed to stop interest rate hikes during fiscal 2019. The recent data revealed that China's economy has slowed down and Beijing's December trade data shows a dip in exports and imports which in turn is rapidly weakening the Chinese economy.
The trade - tariff war between the U.S. and China has tumbled the dragon country's economic scenario at the moment. The likely resolution of the Sino - U.S. trade war will improve the situation in the future.
The weak equities market helped the yellow metal to gain majorly in the global scenario. The spot gold was seen trading at $1,297.70 per ounce, up by $6.40 and U.S. gold futures were seen at $1,292 per ounce.
CMC Markets and Stockbroking's Chief Strategist, Michael McCarthy notes that the weakness in the equities and U.S. dollar appears to be providing support for the precious metal. He further added that "The market feels there is a shift in the Fed's stance and it is more accommodative and we are seeing the dollar weakening for several sessions."
Meanwhile, in India, the stock markets sank and Sensex closed at 35,853.56 points, down by 156.28 and Nifty was at 10,737.60 points, down by 57.35 during today's close time.
Investors prefer to invest in safe-haven during uncertainties and hence most of them are investing in the jewellery metal which is helping its value to move up on a regular basis. Added to this, the rise in purchase of the gold by the locals and jewellers ahead of the wedding season is also helping the yellow metal to march up.