Bullions Tips - Gold futures ended with modest losses in the domestic market on Monday as the stellar gains in the precious metal, in the previous session when prices soared by nearly 2 per cent as sinking global equities amidst concerns over the Chinese economy prompted a flight to safe haven assets such as the bullion, paved way for profit-booking, by traders, in Gold, at existing levels.
Further, a continued collapse in oil prices threatened to rekindle a wave of global deflation, denting the appeal of the yellow metal as a hedge against rising prices. Oil slid below the USD 28 per barrel mark to a fresh 12-year low with Iran rattling markets by getting ready to increase its shipments by 500,000 barrels per day after the lift-off of West-imposed sanctions against the Islamic Republic over the weekend, threatening to deepen a global supply surplus.
The yellow metal struggled for direction in thin holiday trade in the overseas market with a stronger dollar curbing the lure for gold as an alternative asset. Stronger greenback makes gold more expensive for those holding other currencies, thus dimming demand.
Gold may rebound today as a slowdown in China’s economy last quarter bolstered the case for further monetary easing measures, boosting gold, a hedge against the inflationary risk of monetary stimulus.
At the MCX, Gold futures for February 2016 contract closed at Rs 26,065 per 10 gram, down by 0.18 per cent after opening at Rs 26,053, against the previous closing price of Rs 26,112. It touched the intra-day low of Rs 25,966.
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