Gold prices fell in India on Wednesday, according to data from India’s Multi Commodity Exchange (MCX).
Gold price stood at 63,078 Indian Rupees (INR) per 10 grams, down INR 230 compared with the INR 63,308 it cost on Tuesday.
As for futures contracts, Gold prices decreased to INR 63,126 per 10 gms from INR 63,257 per 10 gms.
Prices for Silver futures contracts decreased to INR 73,589 per kg from INR 74,095 per kg.
| Major Indian city | Gold Price |
|---|---|
| Ahmedabad | 65,295 |
| Mumbai | 65,150 |
| New Delhi | 65,160 |
| Chennai | 65,290 |
| Kolkata | 65,525 |
Global Market Movers: Comex Gold price stays weak amid rising US Treasury bond yields
- A combination of supporting factors assists the Comex Gold price to regain positive traction on Wednesday and snap a three-day losing streak.
- Bets that the Federal Reserve will cut interest rates in March turn out to be a key factor lending support to the non-yielding yellow metal.
- The possibility of a further escalation of conflict in the Red Sea, along with China’s economic woes, also acts as a tailwind for the safe-haven metal.
- The official Chinese PMI released over the weekend indicated a further deterioration in manufacturing activity and little signs of recovery at the end of 2023.
- A private survey showed on Tuesday that China’s factory activity expanded at a quicker pace in December but business confidence for 2024 remained subdued.
- The US Dollar consolidates the overnight strong gains to a more than one-week top, helped by a sharp rise in the US bond yields, and caps the commodity.
- Traders might also prefer to wait on the sidelines ahead of the US ISM Manufacturing PMI, JOLTS Job Openings data and the crucial FOMC meeting minutes.
(An automation tool was used in creating this post.)
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
Source: https://www.fxstreet.com/news/india-gold-price-today-gold-falls-according-to-mcx-data-202401030917