Prices of gold futures dropped to the lowest levels of the session on Wednesday, after the doubt about the fate of the Chinese economy hit global equities. Also optimistic US economic data supported the case for an interest rate hike later this month.
Gold for December delivery on the Comex Exchange shed $3.80, or 0.33%, to trade at $1,136.00 a troy ounce. In Singapore, Spot gold was down 0.3 per cent at $1,136.51 an ounce, after touching a one-week high of $1,147.16 on Tuesday.
Emerging shares dropped for a third day on Wednesday, approaching a minimum of six years on deepening worries on overall growth, as the weakness in oil prices fueled another drop in the Russian ruble.
Losses in Asian equities could change some gold backgrounds after data showed factory activity fell to a more than two years in August, comes on the heels of a survey showing China’s manufacturing sector contracted at its fastest pace in three years last month.
The Department of Labour said nonfarm business sector in labor productivity grew by 3.3% in the second quarter, above forecasts for a rise of 2.8% versus an initial estimate of 1.3%.
The report came after payroll processing firm ADP said non-farm private employment increased by a seasonally adjusted 190,000 last month, below expectations for a 201,000 increase. The economy added 177,000 jobs in July, whose figure was revised down from a previously reported increase of 185,000.
In the domestic marketplace as participants reduced their positions, largely in line with a weak trend overseas, gold for delivery in October was trading lower by Rs 102, or 0.38%, at Rs 26,731 per 10 grams on MCX.
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