Gold prices hit ₹55029 per 10 gm for first time, silver close to record high2 min read . Updated: 05 Aug 2020, 07:57 PM IST
The spot gold traded firm around $2040 an ounce while spot silver rallied above seven year high an traded near $26.75 per ounce in global markets
Gold prices soared to new record high on Wednesday as uncertainties around rising number of coronavirus have increased. The precious metal touched ₹55029 per 10 gram in Indian markets for first time ever. Globally, gold prices surged to a new record close overnight — settling above $2,000 an ounce. Precious metals soared on easing US dollar and fall in US treasury yields. The spot gold traded firm around $2040 an ounce while spot silver rallied above seven year high an traded near $26.75 per ounce in global markets.
Silver is also inching close to touch its highest price. At the MCX, silver closed at ₹69884 a kg.
According to Kishore Narne, head, commodity and currency, Motilal Oswal Financial Services, factors such as aggressive stance of central banks to push unprecedented amounts of liquidity and keep interest rates lower coupled with reignited trade-war concerns, rising covid-19 infections and a threat of second wave infections providing a significant hindrance to global economic growth along with lingering geo-political uncertainty provides a convincing fundamental backdrop for continuation up-trend in both precious metals. “Slowing jewellery demand is more than replaced by investor demand in to exchange traded funds (ETFs) as well as coin and bar sales. We continue to be bullish on gold with potential targets between ₹65,000 to ₹68,000 /10 gms." Narne expects silver to reach anywhere between ₹82,000-88,000 over the next 12-15 month period.
Analysts feel that easy money policy of central banks, weakness in US dollar, rising investment demand, and the belief of investors in silver as an asset class is resulting in optimism for its price.
Among all asset classes, gold and silver have outperformed this year as investors have flocked to buying precious metals considered to be safe haven. In this year so far, gold prices have risen 40.83% while silver prices surged 49.98%. In contrast, equities have seen a sharp decline worldwide following lockdown due to covid-19 outbreak in beginning of this year. In 2020 so far, Sensex is down nearly 9%.
“Silver has been shining relatively faster and brighter in comparison to gold in the international as well as domestic markets," Prathamesh Mallya, AVP- Research, Non-Agri Commodities and Currencies, Angel Broking Ltd said. Mallya sees silver prices to eventually move higher towards $27.5 per ounce in the international market and ₹75000 per kg in the domestic markets, taking in to consideration the recent momentum in the metal.