Home / Markets / Commodities /  Gold prices recover from 4-month lows but still down 9,000 from record highs

Gold and silver prices today edged higher in Indian markets but gains were muted due to flat global rates. On MCX, gold futures were up 0.2% to 47,374 per 10 gram while silver rates rose 0.37% to 63,462 per kg. After dipping to a 4-month low of 45,600 per 10 gram, gold has recovered but the precious metal is still down 9,000 from last year's high of 56,200. In the previous session, gold had ended flat while silver had dipped 0.5%. 

Amid worries about global economic growth as cases of Delta variant of covid cases continue to rise, gold inched higher today in global markets but the gains were muted as the dollar strengthened. After hitting a nine-month high against the euro in the previous session, the dollar held on to recent highs against other major currencies. 

Spot gold rose 0.3% to $1,791.67 per ounce while among other precious metals, silver rose 0.7% to $23.79 per ounce, and platinum gained 1.3% to $1,009.67.

Gold is often seen as a competitor for dollar as a safe store of value during political and financial uncertainties. A higher greenback also makes gold more expensive for those holding other currencies.

Gold rates have rebounded from recent lows by benefitting from safe haven buying amid rising virus cases, increased geopolitical tensions and slowdown in Chinese economy, say analysts. Global virus cases have continued to rise forcing countries to impose tighter restrictions. And geopolitical tensions are high as Taliban fighters took control of Afghanistan.

Gold traders now await minutes from Federal Reserve's July meeting due later in the day for guidance on its tapering plans.

A top Fed official on Tuesday said it could be "reasonable" to start tapering later this year, but will depend on progress in the labour market.

Gold may witness choppy trade as market players assess virus situation, development relating to Afghanistan, China economic health and Fed’s monetary policy outlook however increasing uncertainty may keep prices supported, says Kotak Securities in a note. (With Agency Inputs)

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