Gold Market Is Down, US Fed Released FOMC Minutes: Prompt Hike In Interest Rate?

With a bearish trend in the metal markets, gold rates in the domestic markets in India have fallen for two days in a row today, on January 6. Most of the analysts expected that this year gold will remain quite a bit subdued. That will certainly plunge traders' profits, but it might boost the gold demands long term. Although gold rates are dropping now, as the historical data suggests, gold is a long-term investment, and it will give a much good return in 7-8 years from now on. So, if the gold market is showing a bearish trend, investors might think to buy the precious metal now.

The US Federal Reserve has released its November FOMC meeting minutes affecting the investors' risk sentiment, which had signaled a prospect of an earlier and faster interest rate hike in the US. Brien Lundin, editor of Gold Newsletter told MarketWatch, "The Fed minutes were hawkish, showing greater concerns that inflation would be persistent and generally indicating an accelerated schedule for rate hikes. Thus, they were bearish for gold, as confirmed by the immediate market reaction in the gold price," - Kitco News reported.

Today's fall has been impacted by the huge crash in international markets, in the Comex. Gold rates have plunged by more than 1.60% today, which has eventually impacted Indian markets. India is one of the biggest gold importing countries and the country's domestic rates are influenced by global rates. Today's US Fed's FOMC meeting minutes left multiple impacts on the markets. Cryptocurrencies, along with gold fell significantly today. However, investors are now waiting for the Fed's opinion on the recent spike of the omicron variant and its impact.

Today, Indian gold prices sank by Rs. 250/10 grams. On January 6, 2022, the 22 carat gold prices are quoted at Rs. 46,830/10 grams and 24 carat gold rates are quoted at Rs. 48,830/10 grams. Additionally, today gold prices in Chennai, Bangalore, and Hyderabad have fallen by Rs. 180-200/ 10 grams.

Gold rates are quoted differently, daily. Today's gold rates in major Indian cities follow:

The Comex gold futures dropped by 1.63% and were quoted at $1795.4/oz, till last traded. On the earlier day, Comex gold futures closed at $1825.1/oz. The spot gold prices too fell by 0.96%, and were quoted at $1794.5/oz till last traded. The US dollar index in the spot market stood at 96.24, gaining only by 0.06%. Similarly, in India, the MCX gold in February future quoted at Rs. 47,564/10 grams, gained marginally by 0.95%, till last traded.