Gold Surges on Weakened Dollar and Fading Rate Hike Expectations
Gold prices surged nearly 5% on a weekly basis due to a weaker US dollar and reduced expectations of an imminent Federal Reserve rate hike. The price of 10 grams of 24-carat gold rose to Rs 1,58,860 on Friday from Rs 1,54,066 at market opening on Monday.
The softer US inflation, weaker retail activity, and subdued consumer sentiment continued to temper expectations of near-term monetary tightening. Markets largely priced out a September rate increase following the US Treasury's announcement that it would double its long-dated bond buybacks.
A temporary pullback in Treasury yields along with softness in the US dollar created a supportive backdrop for gold and silver. The yellow metal stood at Rs 1,62,440 while MCX silver futures for September advanced 1.28%.