Caution ahead of Fed decision weighs on Gold
17/12/2014 09:29
Gold futures ended lower in the domestic market on Tuesday as investors and speculators stayed cautious ahead of the outcome of the US Federal Reserve’s two-day meet today.
The Fed may assess whether to retain its pledge to keep interest rates at low levels for a “considerable time”. A decision to drop that commitment may signals higher borrowing costs in the near-term, a move which will be bearish for gold, that tends to benefit from ultra-loose monetary policies.
Higher interest rates may dim the appeal of gold as a store of value. At the same time, plunging oil prices have raised concerns that the Fed may struggle to achieve its 2 per cent inflation target, even as an improving US economy and fast progress in the job market boosts case for monetary tightening.
Gold futures may fall today as investors stay on the sidelines ahead of the Fed decision.
Gold futures for February 2015 contract, at MCX, is trading at Rs. 27,194 per 10 grams, down by 0.46 per cent, after opening at Rs. 27,225, against the previous closing price of Rs 27,320. It touched an intra-day low of Rs 26,986
17/12/2014 09:29
Gold futures ended lower in the domestic market on Tuesday as investors and speculators stayed cautious ahead of the outcome of the US Federal Reserve’s two-day meet today.
The Fed may assess whether to retain its pledge to keep interest rates at low levels for a “considerable time”. A decision to drop that commitment may signals higher borrowing costs in the near-term, a move which will be bearish for gold, that tends to benefit from ultra-loose monetary policies.
Higher interest rates may dim the appeal of gold as a store of value. At the same time, plunging oil prices have raised concerns that the Fed may struggle to achieve its 2 per cent inflation target, even as an improving US economy and fast progress in the job market boosts case for monetary tightening.
Gold futures may fall today as investors stay on the sidelines ahead of the Fed decision.
Gold futures for February 2015 contract, at MCX, is trading at Rs. 27,194 per 10 grams, down by 0.46 per cent, after opening at Rs. 27,225, against the previous closing price of Rs 27,320. It touched an intra-day low of Rs 26,986
