New Delhi: Gold prices today rose 40 amid token buying by retailers and jewellers on the occasion of auspicious ‘Dhanteras’. Global gold prices were, however, steady as investors were cautious ahead of the US congressional elections due on Tuesday. In Delhi, gold rates of 99.9% and 99.5% purity advanced by 40 each to 32,690 and 32,540 per 10 gram, respectively. The precious metal had gained 20 on Saturday. Sovereign gold, however, held flat at 24,900 per piece of 8 gram. There is a strong belief that buying precious metals on the auspicious day brings prosperity. Dhanteras is largely celebrated in north and west India.

Following gold, silver ready also edged up by 10 to 39,540 per kg but weekly-based delivery fell by 183 to 38,637 per kg in line with weak global cues.

Compared to last year’s Dhanteras, gold prices have surged by 1,980 or over 6%, while silver has dropped by 1,470 or 3.5%.

Bullion traders said sales were higher by nearly 20 per cent and are expected to pick up later in the day on offers including discount on diamond jewellery and making charges of gold jewellery, apart from other incentives. Buying activity was more pronounced in ‘gold’ and ‘silver’ coins on the auspicious occasion, they said adding gold prices ruling at near six-year highs, marked just token purchases that restricted volume of business.

“Rupee’s trajectory is one of the major factor that will set the tone for domestic gold prices," according to Religare Broking Ltd. The rupee weakened against the US dollar tracking losses in Asian currencies. At 4.01pm, the rupee was trading at 73.07 a dollar, down 0.87% from its previous close.

“Though most of the factors point towards a positive outlook for prices from a long term perspective, but there are certain downside risks too emanating from Fed’s tightening path and the strength in dollar index that can cap gains in the precious metal," noted Religare Broking in a report.

Global spot gold rate was steady at $1,232.63 per ounce, while US gold futures were flat at $1,233.5 per ounce.

“Traders don’t want to extend any risk because of the growing uncertainty around the elections," Reuters quoted Stephen Innes, APAC trading head at OANDA in Singapore as saying. “We are seeing increasing weariness that the U.S. dollar could run out of steam, which naturally plays into gold... If we get a little bit of escalation of U.S. political risk that plays even more favourably into gold," Innes added.

With inputs from agencies

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