Gold prices surge today, silver rates jump

New Delhi: Gold prices today climbed beyond the ₹ 33,000 mark amid higher global prices and strong demand from local jewellers. Gold rates rose ₹ 225 to ₹ 33,100 per 10 gram at the bullion market, Press Trust of India reported, quoting All India Sarafa Association. Tracking gold, silver rates gained ₹ 250 to ₹ 40,100 per kg on increased demand from industrial units and coin makers, the report said. In Delhi, gold of 99.9% and 99.5% purities advanced by ₹ 225 each to ₹ 33,100 and ₹ 32,950 per 10 gram, respectively.

Similarly, sovereign gold today rose by ₹ 100 to ₹ 25,400 per piece of eight grams. Silver ready gained by ₹ 250 to ₹ 40,100 per kg, while weekly-based delivery rose by ₹ 146 to ₹ 39,617 per kg. Silver coins, however, held flat at ₹ 77,000 for buying and ₹ 78,000 for selling of 100 pieces.

A fall in the rupee’s value also boosted gold prices. The rupee fell close to one-month low of 70.80 against the US dollar today. Rupee’s fall increases the imported price of gold.

In global markets, gold prices inched higher on expectations that the US Federal Reserve will not raise rates this year. Weak global equities also boosted the price of ‘safe-haven’ gold.

Gold prices typically rise on expectations of lower interest rates, as they reduce the opportunity cost of holding a non-yielding bullion. Spot gold rates were up 0.3% to $1,291.68 per ounce.

Gold prices face resistance at around $1,300 level, say analysts. Spot gold prices have gained over 11% since hitting a over one-year low in mid-August at $1,159.96 due to volatile stock markets and a weaker dollar.

“The geopolitical risks have also started to induce some safe-haven buying. Investors are becoming increasingly worried about the Brexit negotiations. At the same time, there appears no end in sight for the US government shutdown,” ANZ said in a note.

Meanwhile, back in India, the government has fixed the price at ₹ 3,214 per gram for the new series of sovereign gold bonds opening today. The Sovereign Gold Bonds 2018-19 (Series V) will be opened for the period January 14-18, the RBI said in a statement Friday.

Investors applying online will get a discount of ₹ 50 per gram. For such investors, the issue price of gold bond will be ₹ 3,164 per gram of gold.

One big advantage of sovereign gold bonds vis-à-vis other gold-buying options like gold ETF and gold jewellery is that the gold bond scheme gives a 2.5% per annum interest on the amount invested.

(With Agency Inputs)