US President Donald Trump's decision on Thursday to place tariffs on imports of aluminium and steel raised fears of retaliation by other nations and knocked the dollar from a six-week high, making dollar-denominated gold cheaper for users of other currencies.
The dollar inched up but still hovered near a two and a half year low versus the euro on Tuesday. Its outlook remained clouded by US political turmoil and doubts about whether there will be another Federal Reserve rate hike this year.
Gold futures fell Rs 94 to Rs 28,384 per 10 gm today as participants trimmed their positions after a decline in global prices of the precious metal. The August contract of gold fell by Rs 94 or 0.33 percent lower at Rs 28,384 per 10 gm.
Domestic gold prices have plunged below Rs 25,000 per 10 g for the first time since August 2011, mirroring an international trend. Harish Damodaran explains the factors behind the fall, after the bull run earlier in this decade.