Gold prices in India remained muted today despite an uptick in global rates. On MCX, August gold futures were down 0.21% to ₹47,007 per 10 gram, their second decline in three days. But silver continued to march higher on expectations that reopening of economies will spark a revival in industrial demand for the metal. Silver futures on MCX rose 0.6% to ₹50,409 per kg, adding its ₹1,600 gain on Friday.
In global markets, gold prices moved higher today as violent protests in some American cities and deepening US-China rift drove traders towards the safe-haven metal. Spot gold was up 0.4% at $1,733 per ounce but higher equities forced the precious metal to shed some early gains.
Jigar Trivedi, research analyst at Anand Rathi Shares, said: "MCX gold witnessed a slight weakness in early trade. However the undertone is positive amid protests in the US over the death of George Floyd in police custody and US-China tensions. MCX silver on the other hand had crossed ₹50,000 mark comfortably as gold/silver ratio has cooled down from 114 (1st May 2020) to 97 as on today. Silver on the MCX gained by 23% in May and we believe same momentum to continue for some more sessions."
In the US, protesters have flooded the streets over the death of George Floyd in police custody, sparking fears of a resurgence of COVID-19, which has killed more than 1 lakh Americans.
Asian shares were at a three-month highs today as progress on opening up economies helped offset jitters over riots in US cities. Factory activity in China grew at a slower pace in May, but momentum picked up in the services and construction sectors. A private survey showed a return to growth in May, though exports remained depressed.
Gold continued to attract strong investment demand amid global uncertainties with holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund or ETF, rising 0.3% to 1,123.14 tonnes on Friday.
The escalation in tensions between the U.S. and China last month had threatened to add to uncertainties about global recovery. But on Friday, US President Donald Trump stopped short of specifying tough sanctions over China’s new national security law for Hong Kong.
(With Agency Inputs)
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