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Gold prices cross another peak today! Rs. 1000 up in 2 days; silver rates surge too!
Posted on: 07/Aug/2020 12:55:28 PM
Though there have been sharp gains in gold, many analysts still remain bullish on the precious metal!
Gold and silver prices moved higher today in Indian markets continuing their recent momentum.
On MCX, October gold futures increased by Rs. 300 to a new high of 56143 per 10 gram. Silver futures rallied ₹1,750 or 2.3% to Rs. 77,802 per kg.
In the previous session, gold had surged 1.3% or Rs. 720 per gram, hitting an intra-day high of Rs. 56,079 per 10 gram, while silver had jumped 5.6% or Rs. 4,100 per kg. In India, gold is up 44% this year, tracking a global rally.
In global markets, gold continued its record-breaking streak as the prospect of more stimuli and simmering US-China tensions boosted the safe-haven appeal of gold. Spot gold was up 0.3% at $2,068.32 per ounce, after hitting a new high of $2,072.50. Silver closed in on $30 when it jumped 2.6% to $29.68 per ounce.
Gold prices were also supported by a weaker US dollar which makes it less expensive for holders of other currencies. The dollar index, which measures the US dollar`s strength against six other currencies was at a more than two-year low.
Meanwhile, the Trump administration and Democrats failed to make any headway on resolving differences on what to include in another wave of the coronavirus stimulus package. Meanwhile, US President Donald Trump said he could act unilaterally on some measures.
US benchmark 10-year Treasury yields fell to their lowest levels in five months, reducing the opportunity cost of holding non-interest bearing gold.
Gold traders will focus on the monthly employment report from the US due later today, which is expected to show a slowdown in job gains last month after a surge in coronavirus cases across the country.
In global markets, gold has rallied more than 35% this year as the coronavirus crisis, low real rates, a weaker dollar, and geopolitical risks have sparked a flight to precious metals. Holdings in exchange-traded funds backed by the metal are at a record.
Still, many analysts remain bullish on gold. Bank of America has reiterated its forecast that gold may reach $3,000 an ounce in 18 months and said it’s “feasible" that silver could hit $35 in 2021.
Meanwhile, in India, the latest tranche of sovereign gold bonds closes today for subscription. The issue price has been fixed at Rs. 5,334 per gram. Those applying online and making payments online get a discount of Rs. 50 per gram.
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