Gold falls to near 5-week low after Fed strikes hawkish note
Commodity Online | August 30 2016
UPDATED 15:46:13 IST

NCDEX Chana under long liquidation; Support seen at 4100

MCX Mentha Oil likely to move in a range of 978.4-1005.4

MCX Cotton under short covering; Support seen at 15870

MCX Aluminium may trade between 136-137.8 levels

NCDEX Jeera under short covering; Resistance seen at 13820

Gold slid to a near five-week low on Monday after comments from top Federal Reserve officials’ fuelled speculation that U.S. interest rates would rise sooner rather than later, boosting the dollar. Speaking at a meeting of leading central bankers in Jackson Hole, Wyoming, Fed chair Janet Yellen said on Friday that an improvement in the economy and the labor market in recent months had boosted the case for hiking rates.

The CME Group's Fed Watch tool showed the market pricing in more than a 30 percent chance of a hike in September, up from 18 percent before Yellen and her deputy Stanley Fischer spoke. Spot gold touched its lowest since July 26 at $1,314.70, and was down 0.1 percent at $1,319.81 an ounce. Gold futures for December delivery were down $2.80 an ounce at $1,323.10.

Gold whipsawed on Friday, rising as much as 1.5 percent in the immediate wake of Yellen's comments, before slipping back to end the day marginally lower. Gold is highly sensitive to rising U.S. interest rates, which increase the opportunity cost of holding non-yielding bullion while boosting the dollar, in which it is priced. Hedge funds and money managers increased their net long position in COMEX gold contracts in the week to Aug. 23, U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday.

Courtesy: Religare