Gold prices in India struggle after hitting record highs1 min read . Updated: 09 Jul 2019, 12:26 PM IST
- High gold prices are hurting demand in India: Analysts
- Global gold prices are also off multi-year highs
Gold prices in India today struggled to push higher, amid a weak global trend. On MCX, August gold futures traded 0.03% higher at ₹34,590 after hitting a new high on Friday. August gold futures had hit ₹35,100 after the government increased import duty on gold to 12.5% from 10%. A fall in global gold prices pushed domestic prices off record highs. Gold prices have eased in global markets after strong US job numbers, released on Friday, eased rate cut expectations from US Federal Reserve.
US bond yields have also recovered while the dollar index has rebounded to near a three-week peak, after investors rolled back expectations for a sharp US rate cut at the end of July. Gold is highly sensitive to interest rates and a lower chance of a cut would increase the opportunity cost of holding the non-interest-bearing bullion.
However, gold prices drew support from weaker global financial markets. Market participants now await Fed Chairman Jerome Powell's two-day testimony before Congress, which starts on Wednesday for clues about a rate decrease.
On the technical side, spot gold has support at $1,387 and resistance at $1,421 per ounce, according to Reuters technical analyst Wang Tao.
Industry officials say that gold demand in India could be hit after the import duty hike and that could weigh on global prices.
In another development, Titan Company said its revenue from jewellery segment grew by a muted 13% in the first quarter as consumer demand in June was hit by a sharp increase in gold prices.