Gold prices soften on US debt limit deal; check latest rates here
2 min read 29 May 2023, 04:41 PM ISTOn Multi Commodity Exchange (MCX), gold futures due for a June 5 delivery, were last seen trading higher by ₹130 44 - or 0.22 per cent - at ₹59,483, having swung between ₹59,271 and ₹59,539 during the session so far.
PremiumGold prices softened by ₹110 to ₹59,965 per 10 grams in the national capital on May 29 amid a fall in the metal's prices overseas, according to HDFC Securities. The precious metal had settled at ₹60,075 per 10 grams in the previous trade. Silver, however, jumped ₹290 to ₹73,040 per kg.
On Multi Commodity Exchange (MCX), gold futures due for a June 5 delivery, were last seen trading higher by ₹130- or 0.22 per cent - at ₹59,483, having swung between ₹59,271 and ₹59,539 during the session so far, compared to their previous close of ₹59,353. Silver futures for a July 5 delivery were last down 0.12 per cent at ₹71,142.
Domestic spot gold opened at ₹59,973 per 10 grams on Monday, and silver at ₹70.969 per kilogram - both rates excluding GST, according to Mumbai-based industry body India Bullion and Jewellers Association (IBJA).
In the international markets, gold was trading lower at $1,944 per ounce while silver was up at $23.39 per ounce. The yellow metal edged lower as a tentative deal sealed over the weekend to suspend the US debt ceiling coupled with jitters around higher-for-longer interest rates dampened demand for the non-yielding metal. Spot gold was down 0.1 per cent at $1,945.11 per ounce, hovering near two-month lows hit on Friday. US gold futures were listless at $1,944.30.
Also hurting gold’s appeal as a safe-haven asset, US President Joe Biden on Sunday said he had finalized a budget agreement with House Speaker Kevin McCarthy to suspend the $31.4 trillion debt ceiling until January 1, 2025 and that the deal was ready to move to Congress for a vote.
Meanwhile, US consumer spending increased more than expected in April and that inflation accelerated, data showed on Friday. The report raised the chances of a 25-basis-point hike by the US central bank in June to 63 per cent and rates staying there for the rest of the year, according to the CME FedWatch tool.
Gold, which offers no yield of its own, tends to fall out of favour among investors when interest rates rise. A firmer dollar index made bullion more expensive for overseas buyers, while Asian shares rose as the deal to suspend the US government’s debt ceiling ended a protracted stalemate.
What analysts say:
“The fact that the odds of a hike were as low as 17.4% just over a week ago show how expectations for a Fed pause have been abandoned, helping the U.S. dollar rise for a third week and weigh on gold prices," City Index senior market analyst Matt Simpson told news agency Reuters.
"Gold prices inch lower as a tentative deal sealed over the weekend to suspend US debt ceiling coupled with jitters around further rate hikes weighed down on the non-yielding metal’s appeal,'' said Navneet Damani, Senior VP – Commodity Research at Motilal Oswal Financial Services of India.
"Exciting news! Mint is now on WhatsApp Channels 🚀 Subscribe today by clicking the link and stay updated with the latest financial insights!" Click here!
