Gold futures logged slim gains in the domestic market on Monday as investors and speculators looked ahead to the US Federal Reserve’s two-day meet this week in which the world’s top central bank may offer some cues over when it plans to raise interest rates in the US for the first time in almost a decade.
However, the world’s top central bank isn’t expected to hike interest rates just yet amidst below par inflation and threats to US economic outlook from a struggling global economy.
Data which showed a plunge in new home sales to a ten-month low in September signaled concerns over the health of the world’s biggest economy, weakening the case for a rate lift-off by the Fed this week.
Gold, a hedge against the inflationary risk of monetary stimulus was supported by fresh stimulus from China which cut interest rates for the sixth time since November and lowered the amount lenders must set aside as reserves, in a bid to help stem a slowdown in the world’s second biggest economy.
Meanwhile, a weaker dollar which increased the appeal of gold as an alternative asset by making the bullion cheaper for those holding other currencies, helped spur a rally in the yellow metal in the overseas market.
Gold futures may trade on a cautious note today as the Fed kicks off a two-day meet.
At the MCX, Gold futures for December 2015 contract closed at Rs 26,823 per 10 gram, up by 0.05 per cent after opening at Rs 26,834, against the previous closing price of Rs 26,809. It touched the intra-day high of Rs 26,927. ead
However, the world’s top central bank isn’t expected to hike interest rates just yet amidst below par inflation and threats to US economic outlook from a struggling global economy.
Data which showed a plunge in new home sales to a ten-month low in September signaled concerns over the health of the world’s biggest economy, weakening the case for a rate lift-off by the Fed this week.
Gold, a hedge against the inflationary risk of monetary stimulus was supported by fresh stimulus from China which cut interest rates for the sixth time since November and lowered the amount lenders must set aside as reserves, in a bid to help stem a slowdown in the world’s second biggest economy.
Meanwhile, a weaker dollar which increased the appeal of gold as an alternative asset by making the bullion cheaper for those holding other currencies, helped spur a rally in the yellow metal in the overseas market.
Gold futures may trade on a cautious note today as the Fed kicks off a two-day meet.
At the MCX, Gold futures for December 2015 contract closed at Rs 26,823 per 10 gram, up by 0.05 per cent after opening at Rs 26,834, against the previous closing price of Rs 26,809. It touched the intra-day high of Rs 26,927. ead
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