MCX Gold futures witnessed a heavy correction in intraday moves before edging up though the prices could not claim positive territory on dismal global cues. COMEX futures came off their seven-month highs and dropped for a second day today. The metal surged to the highest levels in nearly seven months last week as the US dollar wilted and commodity prices and global equities rallied. Gold futures advanced sharply after the Fed said last Thursday that it would buy $40 billion of mortgage-backed securities each month until it starts to see the labor market pick up. The global futures are quoting at $1760, down nearly ten dollars on the day right now. European equities are trading mixed with a bearish tint amid continued build up of political tensions in China and Japan. In overnight trades, the US stocks slipped after the Federal Reserve's Empire State manufacturing index for the New York region fell for a second straight month in September. Euro also pared back some of the gains in overnight trades and dropped further today. Last week, the US central bank extended an existing program where it buys long-dated securities and sells short-dated ones, and extended guidance for ultra low interest rates out to 2015. The yellow metal has now rallied for a fourth consecutive week and seems to be have been put on a very firm track following the gain of nearly 40 dollars in a single session after the FOMC pledge. The Metal neared $1780 per ounce on Friday and is up more than 200 dollars in the month so far. The Indian gold prices jumped to fresh all time highs above Rs 32000 last week though the strength in the INR capped the upside. MCX Gold futures for October shot up above Rs 32400 per 10 grams in intraday moves but dropped thereafter as the INR broke below 55 per US dollar mark. The Indian currency rose to a four-month high yesterday before losing out today. MCX Gold futures are quoting at Rs 31680, down Rs 131 per 10 grams on the day or 0.41%. Prices had slumped under Rs 31600 in afternoon trades. Euro is off its five-month highs and quotes under 1.3100 against the US dollar. Weakness in MCX futures has pulled off the domestic spot prices around Rs 31800-900 levels and buying is expected to pick up as the festive season approaches.
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