Dollar Strength Triggers Gold Price Decline

Gold prices declined on Monday as the US dollar regained strength and rate hike jitters returned. On the Multi Commodity Exchange (MCX), gold futures for October delivery traded lower by Rs 832, or 0.54 per cent, to Rs 1,53,549 per 10 grams.

Investors booked profits due to a firm US dollar and renewed rate-hike concerns following last week's first interest rate increase in three years. The dollar index held above the 100-mark, with Fed Chair Kevin Warsh's hawkish tone continuing to support the greenback.

Ashish Rajodiya, Head of Commodities at PL Capital, said MCX gold slipped below Rs 1.54 lakh per 10 gram due to the dollar's strength. Saumil Gandhi, Senior Analyst of Commodities at HDFC Securities, noted that physical markets also saw pressure from weak global cues and subdued domestic retail demand.

Comex gold futures declined USD 32.93, or nearly 1 per cent, to USD 4,391.97 per ounce in international markets. The precious metal's value was affected by profit-taking after last week's recovery and a rebound in the US dollar index.