MUMBAI (Commodity Online): Gold prices in the international market on Tuesday remained higher despite the sharp correction in the global equities. The second consecutive month of hike by the central bank of Australia played its role again in taking the bullion near all time high today.
COMEX gold futures jumped to near $ 1067 levels boosted by the Australia's rate hike. The metal is also getting aided by the correction in the global equity markets which were all trading near 14 month high levels last week.
MCX Gold December contract jumped to as high as Rs 16248 per 10-gram level. It was recently seen quoting at Rs 16242 levels up nearly Rs 130. The bullion may face a resistance near Rs 16300 - 315 levels.
The latest data releases from the US indicate that the economy is out of recession and the government might soon consider pulling back the stimulus measures. This would also mean a rise in US interest rates could be around the corner.
Start trading in commodities from as low as $50. Join nowIf not the immediate meeting, then interest rates could rise soon after that and that could give the US Dollar Index a push to the upside. The rally in gold prices could be limited till the fractured state of the dollar.
Once interest rates are pulled back then the dollar could revive as its appeal could rise. Hence, we expect gold prices to continue trading upside only till the dollar remains weak as it makes the yellow metal look attractive for holders of other currencies.
