After settling Nymex trade at $1,286.20 an ounce — the lowest close since September 2010 — August gold took further damage on news exchange operator CME Group Inc. CME was hiking margin requirements.
The CME, which owns the Nymex’s metals-trading Comex division, said following Thursday’s close that it would hike initial and maintenance margins for gold by 25%, according to reports. The CME's decision came after August gold futures plunged $87.80, or more than 6%, to end at $1,286.20 an ounce on Thursday, the futures' lowest closing level since September 2010. The new margins would come into effect after Friday’s close, CME said.
Gold for August delivery is trading up $3 at $ 1289.2 an ounce on the COMEX division of the New York Mercantile Exchange. The contract had tumbled to as low as $1275.4 an ounce marking its lowest level in 2 ½ years.
By late morning in East Asia, the ICE dollar index had edged down to 81.642 from its 81.823 level late Thursday. The dollar had rallied since the Federal Reserve’s statement late Wednesday, signaling it could slow its asset purchases this year if the economy improves further.
A weaker U.S. currency tends to support gold and other dollar-denominated commodities, as it makes them less expensive for holders of euros, yen and other units.
MCX August gold futures may open today’s session near Rs 27000 with resistance near Rs 27100 levels and support near Rs 26700 levels.
Source by Commodity Insights
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