Gold price hits over 3-week low on strong dollar, expected to remain weak
Gold prices in India today: The price of yellow metal in India is expected to remain weak amid a robust dollar and expectations of further interest rate hikes by the US Federal Reserve to control the surging inflation. Gold price in India for 24 carat gold (10 grams) dropped to ₹51,800 while 22 carat gold (10 grams) to ₹47,450. On Friday, the price of 10 gram of 24 carat gold in Delhi stood at ₹53,255, the August 2 level. The closing rate of standard gold with 99.5 purity was ₹53,400 per 10 gram and ornamental gold at ₹4,913 per gram, according to PTI.Spot gold was trading flat at $1,747.55 per ounce as of 8.48am IST, according to Reuters report, as gold prices hit their lowest in more than three weeks.”The upward resumption in the U.S. dollar will of course be weighing on the gold market, but it seems to be more aligned with the simultaneous sell-off seen across bonds, stocks and currencies,” said Clifford Bennett, chief economist at ACY Securities, as quoted by Reuters.”Wherever there had been a period of false hopes such as the Federal Reserve slowing, those expectations appear to be immediately evaporating.”The US Federal Reserve is likely to raise interest rates by 50 basis points in September amid central bank’s resolve to returning inflation to its 2% target, even if that meant risking a US recession. Federal Reserve Chair Jerome Powell will speak this Friday at the annual gathering of central bankers where he’s expected to re-state the resolve to keep raising rates. Howeever, he may probably stop short of signaling how big the hike will be when the officials meet next month.Gold is highly sensitive to rising US interest rates, as these increase the opportunity cost of holding non-yielding bullion, according to Reuters.
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