Gold pares most of week's gains, trades below $2,425/ounce; check prices in Indian cities

Spot gold was trading at $2,424 per ounce at around 0445 hours GMT, which was down by about 0.9% as against the last closing price.

The US gold futures were also down, with the August contracts trading at $2,428 an ounce on the Commodities Exchange Center (COMEX), which was lower by 1.16% as against the previous session's close.

On India's Multi Commodities Exchange (MCX), gold futures for August delivery were trading 1.01% lower at ₹73,409 per 10 gram at 11:05 am.

What pushed the gold prices lower?

Gold rose to its highest-ever mark on Wednesday, at $2,482.29 an ounce, as optimism grew over the much-awaited rate cuts by the US Federal Reserve. The prospects of a lower interest rate received a boost this week as Fed officials said they were "close" to reducing the benchmark lending rates in view of the inflation's downward trajectory.

However, the optimism was partially dampened by the release of stronger-than-expected US manufacturing data, and the country's weekly jobless claims rising at a slower pace than estimated.

The countrywide factory output rose by 1.1% year-on-year in June, as per the official data released by Washington. This was higher than the expectation of 0.2% growth, as estimated by analysts polled by Reuters.

An uptick in factory output may deter the Fed from expediting the cut in the benchmark lending rates, even as other economic indicators signal the need to ease the monetary policy.

The release of US unemployment data may also turn the Fed officials cautious, as the number of jobless claims was far lower than the forecast.

In the week ended July 13, around 20,000 Americans filed for unemployment benefit claims, the US Labor Department said. On the other hand, economists polled by Reuters had estimated the number to reach 230,000.

Notably, a lower interest augurs well for gold rates, as investors turn to the metal as a hedge against inflation when the liquidity increases in the economy.

Gold rates in Indian cities

• As per the local rates tracked by Upstox, the per 10 gram of 24 karat gold in Mumbai was trading 1,36% higher at ₹76,050.

• In New Delhi, the retail prices rose by 1.37% to ₹75,533.

• In Kolkata, the rate was down 0.6% at ₹75,089.

• In Chennai, the price increased by 1.96% to ₹76,124.

According to analysts, the global demand for gold is expected to remain strong in the medium-to-long term. The price could peak to $3,000 an ounce in the international market, as per a forecast released by Citi Research in April.