Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Market / Stock-market-news/  Global gold prices slip as dollar firms on US interest rate hike cues
BackBack

Global gold prices slip as dollar firms on US interest rate hike cues

Spot gold prices were down 0.3% at $1,248.32 per ounce at 8.55am

Gold prices could continue to be slightly pressured into the next month or so, especially as the market awaits key economic data from the United States for further clarity on US interest rate hikes. Photo: Priyanka Parashar/ MintPremium
Gold prices could continue to be slightly pressured into the next month or so, especially as the market awaits key economic data from the United States for further clarity on US interest rate hikes. Photo: Priyanka Parashar/ Mint

Bengaluru: Gold fell on Wednesday in the face of technical resistance and positive economic data that boosted expectations for further US interest rate hikes this year, supporting the dollar and equities markets.

“A resurgent US dollar, along with higher US yields and equities has taken the momentum out of the gold rally for now," said Jeffrey Halley, senior market analyst at OANDA.

The metal was also under pressure after failing to break through its 200-day moving average at $1,260, Halley said, posting its second consecutive down day in Asia.

Spot gold was down 0.3% at $1,248.32 per ounce at 8.55am. US gold futures slipped 0.6% to $1,247.9.

The dollar pulled away from 4-1/2-month lows against a currency basket on Wednesday as solid data backed expectations for more US interest rate hikes this year.

Reinforcing rate hike expectations, US consumer confidence index hit 125.6 in March, surpassing expectations for a reading of 114 and much higher than 116.1 in February. The March level marked the highest since December 2000.

US Federal Reserve vice chairman Stanley Fischer also gave the dollar a lift as he said in a television interview that two more increases to US overnight interest rates this year seemed “about right."

“Perhaps the expectations of a June rate hike have gone up, given the recent statements from the central bank officials," said Jiang Shu, chief analyst at Shandong Gold Group.

The yellow metal was likely to continue the downward momentum through Wednesday to around the $1,235 an ounce level, he added.

A strong greenback makes dollar-denominated gold more expensive for holders of other currencies, potentially decreasing demand.

Meanwhile, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, which is considered a gauge of investment demand, reported an outflow of 1.8 tonnes on Tuesday.

Gold prices could continue to be slightly pressured into the next month or so, especially as the market awaits key economic data from the United States for further clarity on US interest rate hikes, Shu said.

Gold bullion investment will rise for the fourth straight year in 2017 as global political and economic factors are forecast to maintain buying interest, CPM Group said on Tuesday.

In other precious metals, spot silver fell 0.6% to $18.04 per ounce. The metal hit $18.24, the highest since 2 March, in the previous session.

Platinum rose 0.6% to $952.90 per ounce, while palladium prices were down 0.6% to $787.50 an ounce. Reuters

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 29 Mar 2017, 02:07 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App