Gold prices have taken a dip by Rs.3,500 from their peak. All eyes are on the outcome of the US Federal Reserve meeting.
Today's Gold Rates: As anticipation builds for the US Federal Reserve meeting, gold prices worldwide are feeling the squeeze. On the Multi Commodity Exchange (MCX), gold rates for June 2024 delivery closed yesterday at Rs.70,466 per 10 grams, marking a decrease of about Rs.3,500 from its highest ever level of Rs.73,958 reached on April 12, 2024. Internationally, COMEX gold is hovering around $2,298 per troy ounce, while the spot gold price is at approximately $2,288 per ounce. Experts in the commodity market attribute this correction in gold prices to the expectation that the US Federal Reserve might maintain its high-interest rate policy following today's FOMC meeting.
Focus on FOMC Meeting: "Gold prices are on a downward trend following the hawkish remarks made by US Federal Reserve Chairman Jerome Powell. Initially, gold prices surged after positive US economic data, as there were expectations of a rate cut announcement in the FOMC meeting. However, hopes for a rate cut were dampened by escalating crude oil prices and tensions between Iran and Israel," as per analysts.
Analysts anticipate stability in crude oil prices amid discussions for a ceasefire in Gaza, which could ease tensions in the region and prevent broader conflict in Middle Eastern nations.
Impact of US Federal Reserve Meeting: Sugandha Sachdeva, Founder of SS WealthStreet, discussed the potential impact of the US Federal Reserve's decision on interest rates amid persistent inflation. "The Fed's stance on interest rates, especially in light of stubborn inflation, could influence overall market sentiment. A dovish stance might instill confidence in the central bank's ability to bolster the economy, leading to higher stock prices and increased risk appetite. However, if the Fed signals a more hawkish stance and shows reluctance to cut rates despite inflationary pressures, it could initially trigger a market sell-off, but the market appears poised for recovery as investors adjust their expectations for future economic growth and corporate earnings."
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