Gold On MCX Settled Down -1.24%

Gold on MCX settled down -1.24% at 28086 plunged to the lowest in more than a month tracking Comex Gold which dropped $20 to test $1223 an ounce as stocks and oil prices rallied, signaling a shift toward riskier assets. Gold prices booked their lowest settlement in nearly eight weeks after suffering from their first monthly decline since March, as the US dollar spent much of the session rebounding from last week’s sharp loss and gains in US equities dulled investment demand for the precious metal.

Last week’s sharp, nearly global-wide selling in government bonds, fueled by concerns that global central bankers may be inclined to end a protracted period of accommodative policies, rattled markets. The Fed already ended its economy-juicing bond-purchase program in 2014 and has lifted benchmark interest rates, albeit slowly, four times since 2015. Now, fears that central banks in Europe and the US, some of the largest buyers of government bonds, may be shifting from a dovish to a more hawkish posture, has sent investors out of bonds and delivered a sudden jolt higher to yields, which move inversely to prices.

Also the Fed targets a 2% annual inflation rate, but inflation recently has been stubbornly low, since pushing above the Fed’s threshold in February for the first time in nearly five years. Now in the week ahead, investors will be focusing on Wednesday’s minutes of the Fed’s latest meeting for fresh cues on the timing of the next US rate hike. Friday’s U.S. jobs report for June will also be closely watched.Technically market is getting support at 27961 and below same could see a test of 27837 level, And resistance is now likely to be seen at 28315, a move above could see prices testing 28545.

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Suhani Verma

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