Gold futures closed lower in the domestic market on Thursday as the European Central Bank appeared less concerned about deflation and investors awaited an expected rate increase from the Federal Reserve next week.
The expectation for higher rates can lift the dollar, which can undercut appetite for assets priced in the currency. Higher interest rates can also diminish the appeal of precious metals like gold, which don’t bear a yield.
At the MCX, gold futures for April 2017 contract ended at Rs 28450 per 10 grams, down by 0.63 per cent, after opening at Rs 28,550 against a previous close of Rs 28,629. It touched the intra-day low of Rs 28,402.