New Delhi: Gold prices in the futures market today fell by 2.30% at Rs 14,408 per 10 gram in early trade as rupee hardened against the US dollar due to a surge in the equity markets following the outcome of the Lok Sabha polls.
At 12:30am, the most-active June contract was trading down by 2.30% at Rs14,408 per 10 gram at the MCX platform. July contract also slipped by 2.30% at Rs14,402 per 10 gram.
“Gold prices are falling because of strong rupee. Otherwise, the global prices are ruling steady at 931 dollar per ounce,” Hyderabad-based Commodity brokerage Karvy Comtrade Research Head Harish G said.
A strong rupee makes the dollar denominated asset cheaper, he said, adding the rupee may further appreciate due to an increase in investment by foreign institutional investors (FIIs) on account of bullish equity market.
Rupee began to appreciate taking cues from Sensex and Nifty, which hit the upper circuit for the first time today in the history of Indian stock market.
At the spot market, rupee rose by 130paise at Rs48.10 against the US dollar today, over its previous close of Rs49.40. A similar trend was seen in the currency futures at the National Stock Exchange, where the most-active May contract of rupee rose by 144paise at Rs48.11.