Silver futures on MCX rose 0.4% to ₹67050 per 10 gram. In the previous session, gold prices had edged 0.7% or ₹350 higher while silver advance 0.06% amid a volatile ride. On Tuesday, gold futures on MCX had collapsed nearly 6% or ₹3,200 per 10 gram. Last week gold had crossed ₹56,000 on its way to record highs.
Gold prices in India today fell as the volatile ride continued in global markets. On MCX, October gold futures dipped 0.4% ₹52,036 per 10 gram, the second decline in three days.
MCX gold futures have support in the zone of ₹50450/49200 while on the upside resistance at ₹53600, Geojit Financial Services said in a note.
In global markets, gold prices today edged higher after Tuesday’s 6% drop – the biggest fall in seven years. Spot gold today traded 1% higher at $1,936.29 an ounce. Futures for December delivery declined 1% to $1,930.40 on the Comex in New York. Last week, gold had rallied to an all-time high of $2,075.47.
Silver has also been on a roller coaster ride. Silver for immediate delivery rose 0.3% to $25.5884 an ounce, following a 2.9% gain on Wednesday and 15% slump on Tuesday.
The factors that had pushed gold to an all-time high were back in play today. A weaker U.S. dollar and concerns over the global economic recovery boosted the demand for the safe-haven metal.
Supporting gold price is rising virus cases globally, increased US-China tensions and political wrangling over additional stimulus measures in US, Kotak Securities said in a note.
The dollar index fell 0.2% against its rivals, making gold less expensive for holders of other currencies. * Benchmark 10-year Treasury yields dipped from one-month highs, reducing the opportunity cost of holding non-interest bearing gold.
Gold is seen as a hedge against inflation and the fear of currency debasement.
Many analysts remain bullish on gold despite the recent volatility in prices after Russia announced world’s ‘first’ covid vaccine that led to profit-taking.
Expectations of the US Federal Reserve remaining dovish for an extended period of time and stimulus measures from governments will support gold, they say.
Large stimulus measures tend to support gold, which is often considered a hedge against inflation.
Concerns over the economic damage caused by the pandemic as Britain’s economy shrank by a record 20.4% in the second quarter buoyed gold’s appeal along with a weaker dollar.
Precious metals regained control on weak UK data that renewed economic fears in the Euro region, said Geojit Financial Services in a note.
