Gold fell as traders kept evaluating the outlook for monetary policy

The reason behind the -0.33% decline in gold prices that occurred recently, with a closing price of 61024, is traders assessing the monetary policy environment. The Fed’s cautious approach and intention to continue a tight policy for an extended length of time were evident in the FOMC minutes. With a minor decline in betting on a rate cut in March, expectations are high that the Fed will maintain current rates in December.

Concurrently, the European Central Bank is indicating that interest rate hikes will cease, and certain investors are anticipating a possible rate reduction in April of the next year. Gold imports into India reached a 31-month high in October, rising 60% as a result of jewellers’ increased purchases and reduced prices ahead of a major festival.

The increase to 123 metric tons, worth $7.23 billion, may have an effect on the price of gold globally, but it may also increase India’s trade imbalance and put pressure on the declining rupee. Retail sales for Chinese jewellery companies increased 12.2% YoY from January to September, reaching a total of 247.2 billion yuan ($34.4 billion).

With a -16.89% decline in open interest that settled at 5618, the market appears to be in a lengthy liquidation from a technical perspective. There is resistance forecast at 61280, while support for gold is at 60855, possibly touching 60685. A test of 61535 might result from the aforesaid breakthrough.

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