- Gold spot price down by 3% in less than a week
- Jerome Powell, Chairman of US Federal Reserve talks of gradual rate hikes
- Price of Gold in major Indian cities down in the range of 0.3-0.7% (Rs 60- Rs220)
Jerome Powell, the newly chaired head of the Federal Reserve in a meeting, announced that the Federal Reserve would look forth to implementing gradual rate rises. This was in order to prevent any economic downturn. His comments resulted in forex markets holding Dollars, and metal markets taking a downbeat.
Traders and analysts from metal markets said the yellow metal had taken a beating after a downtrend. Gold trades on the spot markets hovered in the price range of $1362 on 24th February. Spot-price is already down to levels of $1316 per ounce. (1 ounce is 28.34 grams)
Higher interest rates would make the dollar more attractive, and investors are likely to dump their Gold. Gold does not offer interest benefits.
On the MCX, gold prices fell 0.7% to close at Rs. 30438 per 10 grams.
In the domestic market, prices were down by 1%, but on the retail front, data from Sify.com, shows that the margin of dip hovered in the range of 05-0.7%. Here is price per 10 grams across major national cities of India:
- Delhi: Down by 0.5% or Rs 170 per 10 grams: 31711.23 (24 Karat), 29650 (22 Karat)
- Chennai: Down by 0.55% or Rs 175 per 10 grams: 29080 (22 Karat), 31101.60 (24 Karat)
- Mumbai: Down by 0.2% or Rs 65 per 10 grams: 30020 (22 Karat), 32106.95 (24 Karat)
- Kerala: Down by 0.53% or Rs 160 per 10 grams: 28150 (22 Karat), 30106.95 (24 Karat)
- Bengaluru: Down by 0.7% or Rs 220 per 10 grams: 28500 (22 Karat) 30481.28 (24 Karat)
- Hyderabad: Down by 0.65% or Rs 205 per 10 grams: 29010 (22 Karat), 31026.74 (24 Karat)
Here is a read-reckoner of the domestic prices.
Although price of Gold in domestic markets has taken a hit, Sovereign Gold remained unchanged at Rs. 3100 per gram.
A report from brokerage firm Angel Commodities too highlighted a negative outlook for Gold. In the report, analysts from Angel explained that gold was supported by a "softer U.S. dollar" in the previous week.
The softer dollar helped the metal rebound from its biggest weekly loss in 2018. Traders and analysts will be eager to hear the speeches of heads of the European Central Bank and Bank of England to get a fair idea on the further momentum of the yellow metal. The speeches will be made within the week.
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