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Jun 09, 2014, 01.20 PM IST | Source: Moneycontrol.com

Expect spot gold prices to trade negative: Sushil Finance

Spot gold prices are expected to trade on the negative note on the back of strength in DX and expectations among the market participants that the US Federal Reserve may continue reducing its stimulus package at same pace, says Sushil Finance.

Sushil Finance's report on bullion

Gold
A spot gold price decreased by 0.08 percent on Friday’s trading session on the back of positive job data from US indicating improvement in labor market. Further, strength in DX and expectations among the market participants that the US Federal Reserve may continue reducing its stimulus package at same pace added downside pressure on the prices. Additionally, rise in risk appetite in the global markets led to the decline in demand for safe haven. However, European Central Bank slashed its benchmark interest rates by 0.1 percent cushioned sharp fall in the prices.

In the Indian Markets, gold prices fell by 0.43 percent on Friday’s trading session taking cues from Intl spot Gold prices. Further, appreciation in the Indian Rupee added downside pressure on the prices. Gold prices touched an intraday low of 25755/10gms and closed at 25863/10gms.

Outlook
We expect spot gold prices to trade on the negative note on the back of strength in DX and expectations among the market participants that the US Federal Reserve may continue reducing its stimulus package at same pace. Further, strong economic data from US and China may act as a negative factor for the prices as the demand for safe haven may go down. However, European Central Bank decision to ease monetary policy may cushion sharp fall in the prices. In the Indian Markets appreciation in the Indian Rupee may add downside pressure on the prices.

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