Gold futures jumped By More than 1 per cent in the Domestic Market

Gold futures jumped by more than 1 per cent in the domestic market on Thursday as investors and speculators booked fresh positions in the precious metal tracking a rally internationally as a weaker dollar bolstered the appeal of the bullion as an alternative asset.  

Weaker greenback makes gold cheaper for those holding other currencies, thus boosting demand.Further, the European Central Bank (ECB) unleashed its biggest stimulus package yet, as it slashed all of its key rates while expanding the scope of its bond buying program, bolstering gold, a hedge against the inflationary risk of monetary stimulus.
 

The ECB cut its deposit rate by 10 basis points to -0.4 per cent while the benchmark rate was lowered to 0 from 0.05 per cent and monthly bond purchases were increased to 80 billion euro from 60 billion euro with corporate bonds now eligible. Read More - Mcx tips

 

The ECB also signaled concerns over the Euro area growth outlook, boosting gold’s safe haven appeal. The ECB cut its Euro area growth forecast for 2016 to 1.4 per cent from 1.7 per cent while that for 2017 was reduced to 1.7 per cent from 1.9 per cent.Gold may extend gains today on fresh ECB stimulus spree and on concerns over global growth outlook.
 

At the MCX, Gold futures for April 2016 contract closed at Rs 29,931 per 10 gram, up by 1.13 per cent after opening at Rs 29,550, against the previous closing price of Rs 29,598. It touched the intra-day high of Rs 29,961.