Gold Prices Fall By A Tad; Prospect Of More US Stimulus, New Jobless Data, Corona Lend Support

Gold prices in India on September 3, 2020 slipped for third day in a row. On the MCX, gold futures for October delivery were trading marginally lower by 0.07% or Rs. 34 at Rs. 50787 per 10 gm.

Silver too was down in trade by 0.3% or Rs. 184 at Rs. 65600 per kg. In the previous session, gold and silver prices recorded a sharp fall.

Gold Prices Fall By A Tad; Prospect Of More US Stimulus, New Jobless Data, Corona Lend Support

International gold rates

Globally gold rates were more or less unchanged after previous day's drag. Spot gold inched higher by 0.1% to $1,944.58 per ounce. The new jobless claims in the US have not gone down on expected lines and as per data released Wednesday private employers hired lesser workforce in August than expected, indicating slower recovery in the labour market.

The dollar index which was hovering close to its over 2-year low also surged to 92.852, rendering gold expensive for holders of other currencies. "The persistent rally in US and global equity markets amid hopes of economic recovery is also negative for gold. However, supporting price is rising virus cases globally which may force countries to take a cautious approach towards reopening thereby hampering economic activity. Increasing US-China tension is another challenge for global economy which is still struggling to gain momentum," Kotak Securities said in a note.

Also, gold price got further support from the possibility of additional bail-out package from the US.

Meanwhile, India continues to report the highest daily caseload of coronavirus positive people globally, pushing gold's safe-haven appeal. Investors resort to gold in times of political and economic crisis.

Outlook for gold price

"Gold may witness choppy trade as US dollar counters signs of recovery against Fed's dovish stance. However we expect to see buying interest in gold at lower levels amid persisting risks to global economy and hopes of continuing stimulus measures", added the brokerage firm.

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