A stronger greenback makes gold expensive for holders of other currencies
Gold Price In India: Domestic gold futures fell on Wednesday as the global spot rate slid below the $2,000 per ounce mark a day after registering sharp gains. Multi Commodity Exchange (MCX) gold futures – due for a delivery on October 5 – declined by as much as Rs 446 – or 0.83 per cent – to Rs 53,125 in morning deals, compared to their previous close of Rs 53,571. At 10:03 am, the MCX gold futures contract quoted at Rs 53,150, down Rs 421 – or 0.79 per cent – from its previous close.(Track Gold Price Here | Silver Is Outperforming Gold, Is It The New Gold?)
In the international market, the spot gold was last seen trading 0.4 per cent lower at $1,993.68 per ounce, having hit a one-week high of $2,014.97 in the previous session.
Analysts awaited minutes from the US central bank’s last policy meeting.
(Also Read: Gold’s “Dream Run” May Continue, Say Analysts)
The dollar index steadied after hitting a more than two-year low in the last session. The dollar index – which gauges the greenback against six currencies – rose as much as 0.09 per cent on Wednesday. A stronger dollar makes gold expensive for holders of other currencies.
Gold has been one of the most consistent gainers through the six months of coronavirus pandemic-led turmoil in financial markets, benefiting from a flood of capital into the world economy and investors seeking a relatively safe location to put their money in.
The dollar, also considered a safe-haven, has lost its appeal recently after the Federal Reserve rolled out a wave of fiscal measures and cut interest rates to near zero to mitigate economic damage caused by the coronavirus outbreak.
(Gold futures had risen to an all-time high of Rs 56,191 on August 7)
#Gold and #Silver Opening #Rates for 18/08/2020#IBJApic.twitter.com/IbQmaVF5HO
— IBJA (@IBJA1919) August 18, 2020
What Analysts Say
“Gold fell as low as $1985.2/oz in intraday trade yesterday in reaction to upbeat US housing data and some US equity indices hitting record high level but recovered soon to end above the pivotal $2000/oz mark,” said Ravindra Rao, VP-head commodity research, Kotak Securities.
“Gold has rebounded sharply from recent lows and is holding near the key $2000/oz level which shows possibility of extended gains.”
