Silver prices are rallying along with gold amid sharp ETF inflows
New Delhi: Gold prices are again on a record-setting run. Gold prices today jumped ₹300 to a fresh all-time high of ₹39,970 per 10 gm, Press Trust of India reported, citing All India Sarafa Association. A rally in global markets and weaker rupee lifted the price of gold and silver today. Silver prices surged ₹2,110 to ₹48,850 per kg. Gold of 99.9% and 99.5% purity jumped ₹300 each at ₹39,970 and ₹39,800 per 10 gram while silver ready skyrocketed ₹2,110 to ₹48,850 per kg.
Futures markets also showed similar trend. Reversing early losses, October gold futures on MCX were up 0.45% to ₹39,217. September silver futures surged nearly 2% to a new high of ₹46925 per kg.
In global markets, gold prices were steady today after a sharp jump in Tuesday's session. Spot gold prices were unchanged in Asia at $1,542.25 per ounce, closer to its six-year high. Gold got a boost as the US yield curve inversion deepened on Tuesday to levels not seen since 2007, which sent US markets sharply lower amid deeper worries about the global economy.
Silver prices in global markets held around 2-year highs today after breaching the $18 an ounce in yesterday's session. Spot silver today gained 3.14% to $18.18 an ounce.
The trade war between the US and China, which is into its second year, has triggering fears of a global economic slowdown, roiling equity as well as currency markets.
Many analysts have attributed the jump in silver prices to a catch-up rally after sharp rise in gold prices. Gold prices in India are up around 20% so far this year.
Apart from concerns about global slowdown and worries that a US-China trade breakthrough is not happening soon, gold prices have a boost from buying from central banks.
Many analysts expect this trend to continue. Central-bank accumulation of gold “has further room to run," Deutsche Bank AG said in a report, as they gradually migrate reserve assets away from the dollar. Central banks added 374.1 tons in the first six months, helping push total bullion demand to a three-year high, said World Gold Council.
"Supporting gold price is continuing investor inflows. Gold holdings with SPDR ETF rose by 13.49 tonnes to 873.32 tonnes, highest since November 2016. Gold may witness choppy trade amid uncertainty about US-China trade conflict and Fed’s monetary policy however the general bias may be on the upside as trade concerns and global growth worries may keep safe-haven demand high," Kotak Securities said in a note.
"Silver has benefitted from firmness in gold price and some stability in industrial metals," the brokerage added.
In India, the sharp rise in gold prices this year has hit demand. "Domestic demand however remained weak due to higher price. Rise in silver customs duty from 10% to 12.5% has deterred buying interest," Kotak Securities said in another note. (With Agency Inputs)