Gold futures end flat as robust US data boosts taper
case
Gold futures closed flat in the domestic market on Thursday as investors and speculators stayed cautious over booking fresh positions in the precious metal as a sharper than expected dip in US jobless claims last week signaled strength in the US labour market, raising bets that the US Federal Reserve will continue to pare its monthly bond buying program in the coming months and exit QE by the end of the year, as planned, dimming the appeal of gold, a hedge against the inflationary risk of monetary stimulus. A stronger dollar against the euro after the ECB maintained its interest rates at a record low, dimmed the demand for gold as an alternative asset. Stronger dollar makes gold more expensive for those holding other currencies. The ECB maintained its key benchmark interest rate at a record low of 0.25 per cent. US Federal Reserve Chairman Janet Yellen said that interest rates are unlikely to rise until there is a strong economic recovery, supporting the precious metal’s demand as a store of value. Tensions mounted in Ukraine as Russia said that its army is testing its combat readiness, supporting safe haven demand for gold. Gold futures may fall today as a rise in global equities dimmed the appeal of the bullion as an alternative investment. Gold futures for June 2014 contract, at MCX, closed at Rs. 28,523 per 10 grams, up by 0.01 per cent, after opening at Rs. 28,555, against the previous closing price of Rs 28,520. It touched an intra-day high of Rs 28,624.
Gold futures closed flat in the domestic market on Thursday as investors and speculators stayed cautious over booking fresh positions in the precious metal as a sharper than expected dip in US jobless claims last week signaled strength in the US labour market, raising bets that the US Federal Reserve will continue to pare its monthly bond buying program in the coming months and exit QE by the end of the year, as planned, dimming the appeal of gold, a hedge against the inflationary risk of monetary stimulus. A stronger dollar against the euro after the ECB maintained its interest rates at a record low, dimmed the demand for gold as an alternative asset. Stronger dollar makes gold more expensive for those holding other currencies. The ECB maintained its key benchmark interest rate at a record low of 0.25 per cent. US Federal Reserve Chairman Janet Yellen said that interest rates are unlikely to rise until there is a strong economic recovery, supporting the precious metal’s demand as a store of value. Tensions mounted in Ukraine as Russia said that its army is testing its combat readiness, supporting safe haven demand for gold. Gold futures may fall today as a rise in global equities dimmed the appeal of the bullion as an alternative investment. Gold futures for June 2014 contract, at MCX, closed at Rs. 28,523 per 10 grams, up by 0.01 per cent, after opening at Rs. 28,555, against the previous closing price of Rs 28,520. It touched an intra-day high of Rs 28,624.
