Gold falls as selling deepens ahead of Fed QE outcome
New Delhi-India (Oct 27) Gold prices dropped at the domestic bullion market on the back of heavy unwinding by stockists and investors amid sluggish demand outlook.
Silver also plummeted owing to massive speculative sell-off, coupled with subdued industrial offtake.
The overall trading sentiment turned highly volatile as traders are very cautious and avoiding any long positions at this juncture due to ongoing uncertainty in global markets over the interest rates hike sooner than previously expected, a bullion dealer commented.
It is widely expected that the US Federal Reserve is going to announce the end of quantitative easing - a massive stimulus program introduced aftermath of the financial crisis when the Federal Open Market Committee concludes a two-day meeting on Wednesday.
Standard gold (99.5 purity) slumped by Rs 260 to conclude at Rs 27,055 per 10 grams from last Wednesday's closing level of Rs 27,315.
Pure gold (99.9 purity) shed by Rs 255 to end at Rs 27,205 per 10 grams against Rs 27,460.
Silver (.999 fineness) tanked by Rs 460 to finish at Rs 39,015 per kg compared to Rs 39,475 previously.
On the global front, the shiny metal continued its downtrend and trading was almost flat at USD 1,230.86 an ounce in early European trade.