Gold dips on Fed rate hike expectation 27/09/2017

Gold dips on Fed rate hike expectation

Gold futures closed lower in the domestic market on Tuesday as comments by U.S. Federal Reserve Chairwoman Janet Yellen reinforced expectations for another interest-rate increase before the end of the year. Rising real interest rates lower the opportunity costs of holding gold because the metal provides no yield, and entices investors to rotate into riskier assets like stocks. Higher rates may also boost the value of the dollar which usually moves in the opposite direction of the gold price. At the MCX, gold futures for October 2017 contract ended at Rs 29880 per 10 grams, down by 0.53 per cent, after opening at Rs 30,100 against a previous close of Rs 30,039. It touched the intra-day low of Rs 29,780.

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