1 day Ago
Gold price today: Gold rates declined in the domestic futures market Thursday morning, tracking weak global cues even though the US Federal Reserve cut benchmark rates by 50 bps and signalled two more cuts may happen this year. The US Federal Reserve on September 18 cut the benchmark interest rate by 50 basis points (bps) or (1⁄2) half a percentage point to 4.75 per cent-5 per cent for the first time in four years, broadly in line with Wall Street estimates.
The move, however, did not boost gold prices. The yellow metal traded flat in international markets while the dollar rose, weighing on gold prices. A stronger dollar makes gold more expensive in other currencies and weakens demand.
A 50 bps rate cut by the US central bank is generally positive for both the stock market and the economy. However, many experts emphasize that it also signals a slowdown in the US economy. Gold may move higher in the medium term after investors digest the rate cut move as the precious metal tends to gain during rate cuts and economic slowdown.
"Earlier, there were expectations that lowering rates would cause a decline in the value of US currency and potentially lift the price of gold and silver. However, the surprise rate cut suggests the US Fed is seriously taking the threat of a slowdown to the US economy, which could boost the safe-haven demand for gold and silver in the immediate run," said Hareesh V, Head of Commodities, Geojit Financial Services. MCX Gold for October 4 expiry traded 0.
16 per cent lower at ₹ 72,939 per 10 grams around 9:30 am. (More to come).
