Gold MCX settled down -0.18% at 28661 little changed in yesterday’s session despite significant geopolitical tensions and Federal Reserve talk. Gains were capped as pressured by the view toward monetary policy, minutes from the Fed appeared to show that the majority of the central bank’s officials remain resolute about hiking rates at their meeting in June.
Rising expectations of a June rate hike prompted a recovery in both the dollar and US treasury yields, but gold futures have been supported by political turmoil in Washington, as investors’ started to question President’s Trump ability to deliver on his pro-growth economic agenda.
While yesterday’s jobless-claims data showing that the US labor market remains healthy eight years into an economic expansion appeared to support the expectation of a rate hike from the Fed as early as June.
From the physical side China’s net gold imports via main conduit Hong Kong dropped 33.5 percent in April from the previous month, data showed on Thursday, as high prices turned off buyers in the world’s top consumer of the precious metal.
Meanwhile, the gold demand in India during Q1 grew by 15 per cent to 123 tonnes, but it was 18 per cent down compared to the corresponding period in the last five years on average. The WGC urged the government to reduce the tax incidence on gold and gold products under the new GST regime.
“In the GST regime, we urge and expect that the total tax burden on gold be halved from the current level of around 12 per cent,” WGC managing director Somasundaram PR said. — Neal Bhai Reports