The future prices of gold and silver were traded with cuts in the market on Thursday. This happened as the dollar hit more than a week high mark in the domestic market traded with cuts in the morning trade on Thursday, as the dollar hit more than a week high mark against the other rival currencies in the previous session. A stronger dollar makes the gold more expensive for any other currency holders.
On the other hand, on Wednesday, the Fed left its key overnight interest rate near zero. There were no changes made to its monthly bond purchases. They were pledged again to keep the pillars of the economy in place until and unless we find a way to get through the pandemic. Gold futures on Multi Commodity Exchange (MCX) were reported to be down by 0.36 percent that amounts to Rs 177 at Rs 48,688 per 10 grams. Silver futures also reportedly dropped by 1 percent or Rs 666 to Rs 65,870 per kg.
According to Ravindra Rao who is the Vice President of Head Commodity Research at Kotak Securities, COMEX gold trades are lower by 0.5 percent near $1,835/oz after a 0.3 percent decline the day before. Gold was seen to weaken as the Fed painted a downbeat outlook for the US economy. Although, he did not hint towards additional measures. Fed’s growth outlook along with ECB’s willingness to cut the rates down pushed the US dollar higher putting more pressure on gold. It was also seen that the ETF outflows showed weak investor interest.
On Wednesday, Gold in the spot market declined from Rs 231 to Rs 48,421 per 10 gram. In the older trade, the precious metal was closed at Rs 48,652 per 10 gram. Silver, on the other hand, was seen to dip Rs 256 to Rs 65,614 per kilogram.
Gold prices edged a little lower on Thursday as the investors opted for the safety of the dollar especially, after the concerns about the pace of recovery in the USA.