Last Updated : March 22, 2010 13:30
US gold futures tumble on Greek debt, profit booking
US good futures tumbled on Friday as a weaker euro due to Greece debt concerns prompted many investors to lock in profits ahead of weekend. A surprise interest rate hike in India also hammered gold prices. Friday’s fall was the biggest one-day percentage loss since Feb 4, when the metal lost 4.2 percent in US spot market. The yellow metal closed barely changed this week after gold erased all its weekly gains on Friday.
US gold futures for April delivery settled down nearly $20, or 1.8 percent, at $1,107.60/oz on Friday.
Gold ended 0.54 percent up for the week.
The dollar index rose for the second straight day and gained 0.62 percent on Friday.
The MSCI world index for stocks declined further by 0.50 percent. Equities fell consecutively for the second day.
Crude oil fell 1.85 percent to hold just above $80/barrel on Friday and weighed down on gold prices also.
SPDR Gold Trust maintained its gold holdings at 1115.51 MT as on Mar 19.
Bullion prices fell in India after RBI hiked its benchmark reverse repo rate and repo rate by 25-basis points to 3.5 percent and 5 percent, respectively. This was the first step to tackle inflationary situations in the country. Gold pared down nearly all its weekly gains on Friday when it lost 1.54 percent to Rs. 16,509/10 gm. Prices were little changed on Saturday. The weekly change was +0.33 percent in MCX gold.
Outlook
Gold is trading almost flat at $1,107/oz levels in Asian hours. The dollar index looks marginally higher which can pressurize gold prices for the day. There are no major economic data scheduled today and hence, equity markets may extend some cues to bullion markets. Asian equities are trading mixed to lower. There are some speculations that more central banks will follow India in raising interest rates which may curb the demand for precious metals. Gold is expected to trade sideways to lower for the day. MCX gold futures may open flat.
Courtesy: Karvy Commtrade Ltd.
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