Gold prices in early trade on Monday failed to holds decline and make any recovery from three straight days of losses as stronger global economic data and higher equities curbed the metal’s safe-haven appeal.
Asian shares jumped, taking heart of upbeat earnings and economic data from the United States that eased fears of global growth and acute hazard appetite. The results of stress tests on European banks at the weekend received quietly in the market.
Last week, US gold futures modest rose on the Friday but still registered a weekly loss as ongoing expectations for a rate hike earlier than expected in the US and a stronger dollar overall.
Comex gold futures for delivery in December quoted at $ 1,230.20 a troy ounce, down 0.06%, after it settled last week at $ 1231.80 a troy ounce. Spot gold remained stable at $ 1,230.86 an ounce, but is not far away from a minimum of one week of $ 1226.17 hit last week.
Decline in gold and silver has increased in the domestic market. Gold is down to Rs 27,200, while the silver is seen around Rs 38,000. As the effect of international market, domestic prices has been declining.” said 100McxTips Commodity Experts.
A recent batch of strong as hopes that US economic data pointed out that the economic recovery maintains momentum and underscored speculation that the US Federal Reserve may raise rates earlier than expected.
Rate hikes likely to damping at gold prices, as it increases the relative cost of holding on to the metal.
The metal’s losses come after global equities posted their biggest weekly percentage gain since July 2013 last week, while the US dollar also strengthened.
A stronger US dollar typically weighs on gold as it absorbs the metal’s appeal as an alternative asset and causes dollar-priced commodities more expensive for holders of other currencies.
Bullion Traders were also watching closely the positions of investors in gold funds. SPDR Gold Trust said its holdings fell 0.6 percent to 745.39 tonnes on the Friday.
The hedge funds and money managers raised their bullish bets on futures and option on gold for the second consecutive week, as the price of gold was recovered in the week until 21st October, the Commodity Futures Trading Commission said on Friday.
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