Gold prices in India moved higher today, snapping a three-day losing streak. On MCX, gold futures contracts for December delivery rose 0.23% to ₹38,040 per 10 gram. Silver prices also edged higher. On MCX, prices of silver contracts rose 0.07% to ₹44,771. In global markets, gold prices were steady today as investors remained cautious about the US-China deal. Spot gold prices were flat at $1,464.36 per ounce.
Reports said that China invited top US trade negotiators for a new round of face-to-face talks in Beijing in efforts to strike a deal.
Investors, however, were wary that bills passed by US lawmakers supporting the Hong Kong protesters could thwart a smooth passage of an interim trade deal.
"Uncertainty over US–China trade deal is the main driver of gold prices. Growing geopolitical tensions and a feeble dollar likely to offer lower level support to prices. On the domestic side, a weak rupee would protect prices from major selling," said Hareesh V, head of research at Geojit Financial Services.
Abhishek Bansal, chairman, ABans Group of Companies, said uncertainty over the US-China deal is keeping gold prices in a range. According to the recently released minutes of US Federal Reserve's last meeting, the central bank would be watching the economic data closely, and the policy was not on a pre-set course, he said, adding the policy failed to provide more hints on the next change.
The Federal Reserve has cut interest rates thrice this year and the last statement had stated a pause in the current easing cycle.
A pause in further rate cuts is negative for gold prices, says Mr Bansal. Lower interest rates reduce the opportunity cost for holding the non-yielding bullion.
The tariff war between the US and China has pushed gold, traditionally a safe asset in times of political and economic uncertainty, about 14% higher this year in global markets, on track for its biggest yearly gain since 2010. (With Agency Inputs)