Gold prices in India today surged as much as ?2,000 per 10 gram, hitting a new high of ?45,724 per 10 gram in futures market. On MCX, June futures were up 3.5% to ?45,269 per cent in recent trade, in a catch-up rally with global markets. In India, commodity derivatives trading markets were closed due to a holiday. Silver futures on MCX today surged over 5% to ?43,345 per kg.
In global markets, spot gold rates were down 0.2% at $1,657.67 per ounce after rising to a four-week high earlier in the session. A stronger dollar, which makes purchases costlier for holders of other currencies, weighed on the metal. Gold prices had jumped nearly 3% in the previous session. Among other precious metals, platinum was steady at $735.26 while silver edged up 0.1% to $14.99 an ounce, after hitting a more than three-week high earlier in the session.
Asian equity markets were mostly higher today after a strong rally overnight on Wall Street on on signs of easing coronavirus deaths.
Gold prices have been supported by strong inflows into ETFs. The holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.54% to 984.26 tonnes on Monday. The quantitative easing (QE) by central banks and stimulus measures by governments have also helped gold price.
To battle the deepening fallout from the coronavirus, the Federal Reserve on Monday announced a program to boost lending to small-businesses while Japan pledged to roll out an unprecedented economic stimulus package.
Gold is also supported by risks from the coronavirus spread which will force central banks and governments to continue with stimulus measures, Kotak Securities said in a note.
On the other hand, weak physical demand in many parts of the world due to lockdowns will weigh on gold at higher price levels, say analysts. India’s gold imports plunged nearly four-fifth in March to lowest in over six years as record domestic prices and a lockdown hurt retail demand, Reuters reported citing sources.
Gold may witness choppy trade as it counters general strength in US dollar index against increasing safe haven and investor buying but general bias may be on the upside amid increasing risks to major economies, Kotak Securities added. (With Agency Inputs)
News Source: livemint