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MTECHTIPS:- Gold Stays Afloat, Weak INR Benefits Local Futures

MTECHTIPS:- Gold Stays Afloat, Weak INR Benefits Local Futures

Good speculative demand is keeping COMEX Gold steady in the first session of the week.Traders are also eying another round of selling in the Chinese equities and the recovery over $1130 per ounce mark for the yellow metal in last session is seemingly holding up.Volatility in global markets and concerns over the possible economic fallout have made the Federal Reserve more uncertain about raising interest rates in September, according to updates from the Fed’s policy summit over the weekend in Jackson Hole. The undertones in US dollar is lax after tame economic data and ideas that the Fed would go easy on itsperceived rate hike. COMEX Gold is quoting at $1132 per ounce, down 0.18% on the day. MCX Gold futures are trading at Rs 26661, up 0.14% on the day as a weak INR supported sentiments. INR is down 0.36% to 66.38 per US dollar following a steep early selloff in local stocks. US Core inflation moderated in July, giving the Federal Reserve another reason to hold short-term interest rates steady at their September policy meeting. Prices as measured by the personal consumption expenditure (PCE) — the Fed’s preferred way of measuring inflation — edged up 0.3% in the 12 months ending July. The core PCE grew 1.2%, down from the 1.3% pace that had been locked in over the first six months of the year. Another piece of data showed that US consumers increased their spending moderately in July. Spending rose 0.3% in July, helped by purchases of big-ticket items such as cars,the Commerce Department reported Friday. The report indicates that consumer spending,which accounts for 70% of economic activity, remains healthy. However, it is unlikely to percolate into an evidence that a rate hike is around the corner given the lax core PCE data.

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