MTECHTIPS;-Gold Takes Massive Hit, Crashes To Six Month Low

MTECHTIPS;-Gold Takes Massive Hit, Crashes To Six Month Low

MTECHTIPS-COMEX Gold futures took a hefty tumble Friday as a break below $1300 per ounce hurt the sentiments for the yellow metal. Strength in US economy and dollar post the US Fed interest rate hike has been negative for Gold and COMEX Gold futures succumbed to massive losses - closing at its six month low of $1282 per ounce, down 2% on the day. MCX Gold futures also plummeted 1.20% to close at Rs 31010 per 10 gram levels. A report released by the University of Michigan on Friday showed a much bigger than expected improvement in US consumer sentiment. The report said the preliminary reading on the consumer sentiment index for June came in at 99.3 compared to the final May reading of 98.0. US Federal Reserve indicated last week that it will hike interest rates more aggressively this year and the next as the US economy continues to grow at an impressive pace. Following its two-day monetary policy meeting, the Federal Reserve raised interest rates by 25 basis points Wednesday. The federal funds rate is now within a range between 1.75% and 2.00%. Gold traders saw the underlying message from the Fed announcement as supportive for the yellow metal initially, thereby pushing it up. Fed will likely raise interest rates two more times this year. Interest rates are expected to increase to 3.1% next year, up from the previous estimate of 2.9%. The dollar had dropped following the Fed meet but gained back impressively after

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