New Delhi: Gold on Friday surged by Rs1,310 per 10 gram in the national capital, the highest in two years, to Rs31,010 on strong demand from stockists ahead of festive season, after government increased import duty on the metal to 10%.
A sharp fall in Sensex and rupee against dollar and strong global cues also contributed to the upsurge in gold price, which posted the biggest single-day gain after 19 August 2011. Interestingly, the metal had shot up by Rs1,310 on 19 August 2011 as well.
Gold has regained Rs31,000 level after a gap of six months. An all-time high was Rs32,975 per 10 gram on 37 November 2012, in Delhi bullion market.
Silver followed suit and spurted by Rs3,270 to Rs49,320 per kg, its biggest single day gain this year on rising demand from industrial units and coin makers. Bullion traders attributed the sharp jump in gold prices to fear of tight supply following government’s decision to hike import duty of silver and gold to narrow current account deficit.
The buying sentiment got bolstered as rupee hit record low of 62 against the US currency, making the dollar -denominated metal costlier.
Seeking to reduce gold imports, RBI also prohibited inward shipment of gold coins, medallions and dores without licence.
“Gold is back in demand as falling rupee and melting equities leaving no place for investor to park their funds,” All India Sarafa Bazar vice president Surender Jain said.
He said a firming trend in overseas markets also supporting the bullion where as market hardly witness any physical buying.
Gold in overseas markets climbed to two-month high on strong buying from China and prospects for less US monetary stimulus. The metal rose by 0.50% to 1,372.97 dollar an ounce in Singapore.
On the domestic front, gold of 99.9 and 99.5% purity spurted by Rs1310 each to Rs31,010 and Rs 30,810 per ten grams respectively. Sovereign followed suit and climbed by Rs200 to Rs24,700 per piece of eight gram.
Silver ready sky-rocketed by Rs3270 to Rs49,320 per kg and weekly-based delivery by the same margin to Rs49,220 per kg. Silver coins flared up by Rs2000 to Rs86,000 for buying and Rs87,000 for selling of 100 pieces.