Gold price slipped on Thursday as the rupee ticked up from its lows, fell by Rs100 to close at Rs124,000 per tola on Thursday contrary to a rise in the international bullion market.
The yellow metal lost Rs100 to settle at Rs124,000 per tola and Rs86 to fall to Rs106,310 per 10 grams in the domestic market.
A day earlier, the precious commodity closed at Rs124,100 per tola and Rs106,396 per 10 grams.
In the international market, the bullion price edged up on Thursday as the dollar eased, although hawkish comments by US Federal Reserve policymakers dented the metal’s appeal and kept it well below the key $1,800 mark.
The price of gold in the international market decreased by $2, settling at $1,790.
Gold has slumped 4.5% from last week’s five-month high, with a growing number of Fed policymakers indicating they were open to raising interest rates quicker, as per minutes of the US central bank’s last policy meeting.
“As markets price in some monetary policy normalisation, that should weigh on gold in the short term. But major central banks are unlikely to aggressively hike rates given the financial burden of higher interest rates and large government debt accumulated” said Hitesh Jain, lead analyst at Mumbai-based Yes Securities.
This more-moderate monetary policy normalisation and the potential loss of momentum in economic growth next year as the base effects of the pandemic wear off, should support gold in 2022, Jain added.
Higher interest rates raise non-interest bearing gold’s opportunity cost.
Meanwhile, silver prices in the domestic market remained unchanged at Rs1,460 per tola and Rs1,251.71 per 10 grams.