MCX GOLD TIPS: Gold closes higher on strong global cues

MCX GOLD TIPS: Gold prices closed higher in the Indian market on Monday as dismal China factory data which showed that manufacturing in the country contracted for a 6th month on the trot in January signaled a worsening slowdown in the world’s 2nd largest economy, bolstering the case for further monetary easing by officials, supporting the lure for Gold, which is a hedge against the inflationary risk of monetary stimulus. The China official manufacturing gauge fell to a three-year low of 49.4 in Jan, below the neutral mark of 50. However, the gains in the bullion were curbed by caution ahead of United State consumer spending and manufacturing data which may signal a continued slowdown in the world’s biggest economy, probably delaying the next Federal rate hike. Gains were also limited as a weaker dollar raised the appeal of bullion as an alternative asset. Weaker greenback makes the Gold cheaper for those holding other currencies, thus increasing demand. At the MCX, Gold futures for Feb 2016 contract closed at Rs 26,782 per 10 gram, up by 0.54% after opening at Rs 26,700, against the last closing price of Rs 26,638. It touched the intra-day high of Rs 26,883.