Gold Price Today: Gold Futures Drop But Hold Rs 50,900 Mark As Dollar Continues To Rise
Gold Price In India: Domestic gold and silver futures continued to fall on Wednesday as a stronger dollar offset support from a pullback in global equities. Multi Commodity Exchange (MCX) gold futures, due for an October 5 delivery - closed 0.83 per cent (Rs 425) lower at Rs 50,928, having dropped to as low as Rs 50,914 during the session. MCX silver futures (December 4) closed at Rs 67,410 after declining to as low as Rs 67,351 during the session, settling with a loss of 1.58 per cent - or Rs 1,084 - for the day. Analysts say investors awaited monetary policy strategies from central banks due this week for cues.
In the international market, gold fell 0.80 per cent to trade at $1,927.70 per ounce on the New York Mercantile Exchange's Comex exchange at the weakest level of the day. Silver slumped as much as 1.37 per cent to $26.62 per ounce. (Also Read: Is Silver The New Gold?)
The US dollar index - which measures the greenback against six other currencies - strengthened to a nearly one-month peak on Wednesday, affecting gold's appeal as a safe-haven bet.
A selloff across Asian equity markets, triggered by a technology stocks-led plunge in the US overnight, however, provided some support to gold rates. Gold is often used as a hedge against inflation and currency debasement.
Back home, spot gold settled at Rs 51,051 per 10 grams on Wednesday, and silver at Rs 64,547 per kilogram, excluding GST, according to Mumbai-based industry body India Bullion and Jewellers Association (IBJA). Gold and silver jewellery prices vary in different parts of the country, due to factors such as taxes and local making charges.
Gold has been one of the most consistent gainers through the six months of coronavirus pandemic-led turmoil in financial markets. Some analysts say gold is still in a bullish trend from a long-term perspective due to the coronavirus pandemic. (Also Read: Gold "Dream Run" May Continue: Analysts)
What Analysts Say
"Mixed factors have led to directionless trade in gold and this may continue in the near term," said Ravindra Rao, VP-head commodity research, Kotak Securities.
"Gold may remain choppy but buying might re-emerge at lower levels amid increasing global uncertainty and also as the Federal Reserve's dovish stance may limit the upside in the US dollar," he added.
"However, we expect buying interest to emerge at lower levels as increasing challenges to the global economy may improve its safe-haven appeal.”