You are currently viewing Gold price today falls despite Omicron fears, down ₹8,000 from record highs – Mint

Gold price today falls despite Omicron fears, down ₹8,000 from record highs – Mint

  • Increasing expectations that Fed may fasten monetary tightening to curb inflation weighed on gold price today despite Omicron fears

Gold prices struggled in Indian markets despite fears over Omicron covid variant. On MCX, gold futures were off 0.2% to 47,791 per 10 gram, down about 8,000 from last year’s record high of 56,000 levels. Silver futures struggled at 61,296 per kg. 
In global markets, gold rates slipped, hurt by a firmer dollar but concerns over new Omicron coronavirus variant capped losses. Spot gold fell 0.1% to $1,780.36 while spot silver rose 0.3% to $22.37 an ounce. 
The dollar index held firm as Fed Chair Jerome Powell reiterated that he and fellow policymakers will consider a faster wind-down to the Fed’s bond-buying programme, a move widely seen as opening the door to earlier interest rates hikes. A stronger greenback increased gold’s cost to buyers holding other currencies.
On the higher hand, reduced stimulus and interest rate hikes tend to push government bond yields up, raising the opportunity cost of non-interest bearing gold.
“Gold is struggling to sustain above $1800/oz level as support from increased safe-haven buying amid renewed virus concerns is countered by increasing expectations that Fed may fasten monetary tightening to curb inflation. Gold may remain choppy however safe-haven buying and inflation concerns may keep a floor to prices,” said Ravindra Rao, VP- Head Commodity Research at Kotak Securities.
Despite Omicron uncertainty, ETF investors remained on the sidelines. SPDR Gold Trust , the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.2% to 990.82 tonnes on Wednesday from Tuesday.
Gold is struggling after Fed chief stated that US Central Bank needs to be respond to the possibility that inflation may not recede in second half of the next year as most forecaster currently expect, said Vidit Garg, director at MyGoldKart.
Technically gold prices are trading below major moving averages which reflects that prices may remain under pressure, he added, saying that break with close above $1803 will only trigger upside rally. (With Agency Inputs)
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