MCX Gold Falls 1%, Heavy Selling In Global Futures
Mumbai-India (Apr 15) MCX Gold futures eased after recent gains today. The global futures slipped from a three-week high as traders booked heavy profits after recent gains. A minor sell off in Asian equities on Chinese overheating worries also hurt the metal. Gold had rallied last night amid renewed tensions between Ukraine and Russia. However, the metal is off these highs today, easing after breaking below $1330 per ounce mark. The counter quotes at $1312 per ounce, down $16 per ounce on the day. MCX Gold futures also followed the trend and currently trade at Rs 28674, down Rs 285 per 10 grams or 1% on the day.
Sales at U.S. retailers went up by 1.1% in March to a seasonally adjusted $433.9 billion, the Commerce Department estimated Monday. This is the largest gain since September 2012. Sales rose an upwardly revised 0.7% in February, compared with previous estimate of a 0.3% gain. US stocks witnessed some buying support after the retail sales data. Stocks in US and Europe had slipped as the effect of the FOMC minutes faded and investors preferred a risk off mood. DOW recovered some of these losses with a 1% rally yesterday.
The finance leaders from the world's 20 largest economies Friday expressed worries that Ukraine's crisis may fuel global economic instability, raising concerns about potential fallout from a major escalation in the sanctions battle between Russia and the West. We are monitoring the economic situation in Ukraine, mindful of any risks to economic and financial stability, the G-20 said in its official communiqué after two days of talks.
Increasingly volatile global capital flows mean that countries have to implement domestic reforms to protect their stability, the International Monetary Fund's powerful advisory board said over the weekend. IMF's International Monetary and Financial Committee (IMFC) said that more volatility was to come, especially as the US tightens monetary policy.
The US Federal Reserve officials had a secret video conference call in early March and reached a general consensus that the 6.5% unemployment rate threshold for the first rate hike was outdated, the central bank said Wednesday. A summary of the videoconference was included in the minutes of the Fed's March 18-19 meeting. On the conference call, the central bankers were clearly worried that changing the forward guidance would impact markets. This boosted sentiments for gold and the metal jumped well above $1300 per ounce levels last week.
The newly emerging middle classes in China, rising real incomes, a deepening pool of private savings and rapid urbanisation across China suggest that the outlook for gold jewellery and investment demand in the next four years will remain strong, according to a latest update from the World Gold Council (WGC). The WGC has released a major report, China's gold market: progress and prospects, examining the factors that have driven China's rise to become the number one producer and consumer of gold since the market began liberalising in the late 1990s.
