Gold Futures Volatile on US Data, Fed Remarks

New Delhi, Nov 6 (PTI) Gold futures on Thursday traded in a volatile range as stronger US economic data and firm comments from Federal Reserve officials dampened the expectations of additional rate cuts, limiting gains in the precious metal.

On the Multi Commodity Exchange (MCX), gold futures for December delivery rose Rs 59, or 0.05 per cent, to Rs 1,20,581 per 10 grams from the previous close of Rs 1,20,522 per 10 grams.

Silver futures for December delivery also gained Rs 103, or 0.07 per cent, to Rs 1,47,424 per kilogram as compared with Wednesday's closing of Rs 1,47,321 per kg.

On Wednesday, commodities exchange MCX was closed in the morning session on account of Guru Nanak Dev Jayanti but later resumed operations in the evening session.

Globally, Comex gold futures for December delivery was trading marginally higher at USD 3,994.55 per ounce while silver went up to trade at USD 48.05 an ounce.

"Gold prices traded around USD 3,990 per ounce on Thursday, moving within a tight range near a four-week low as investors continued to scale back bets on US rate cuts," Jigar Trivedi, Senior Research Analyst at Reliance Securities, said.

He added that the latest macroeconomic data supported a firm outlook for the American economy. Private payrolls rose by 42,000 in October, exceeding forecasts of a 25,000 increase, while the ISM Services PMI climbed to an eight-month high.

"The figures reinforced expectations that there is little room for additional rate cuts, with inflation still above target and the government shutdown delaying key labour data.

"This comes against the backdrop of a hawkish tone from several Fed officials, aligning with Chair Jerome Powell's recent remarks suggesting that the latest rate cut could be the last for this year," Trivedi said.

However, he noted that some Fed policymakers reiterated that interest rates should move lower over time. Adding to the downward pressure, sentiment toward riskier assets improved, reducing the metal's safe-haven appeal.

According to commodities market experts, investors are likely to remain cautious ahead of speeches from several Federal Reserve officials later in the day. The commentary will provide more impetus on the central bank's monetary policy path and could influence the near-term trajectory for bullion prices.