Gold price today: MCX Gold trades lacklustre; why are gold prices falling? Will it remain under pressure in short term?
US Federal Reserve minutes show officials rally around higher-for-longer ratesMCX Gold traded lacklustre in the morning on Friday, May 24, tracking weak global cues. According to Reuters, gold prices in international markets hit a two-week low on Friday and were set for their biggest weekly loss in nearly eight months.Also Read: Gold slips to over one-week low on hawkish Fed, US dataAround 11:45 am, MCX Gold traded 0.02 per cent lower at ₹71,565 per 10 grams.Also Read: Gold pulls back from record highs, drops by ₹2,256 over 3 sessions on profit bookingGold prices are falling due to profit booking as investors believe the US Fed will not cut interest rates anytime soon and the rate reduction later this year will be shallow.Rahul Kalantri, VP of commodities at Mehta Equities, pointed out that gold prices are falling as investors have downgraded expectations of Fed rate cuts following the previous US economic release."S&P Global's May flash readings of the manufacturing, services, and composite PMIs reveal that US economic activity is increasing.
At the same time, the number of Americans filing jobless claims was lower than predicted, indicating that the labour market is strong. This followed the Fed's May meeting minutes, highlighting lingering concerns over sticky inflation, with some members suggesting a willingness to raise interest rates if price growth continued," Kalantri observed.Besides, the rise in the US dollar and bond yields have dented gold's safe-haven appeal.
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