Some analysts suggest a buy-on-dips strategy for gold, saying that virus cases and US-China tensions may keep price supported
Silver prices also fell today
Gold prices in India fell today, tracking a decline in global markets and profit-taking at higher levels. On MCX, gold futures were down 0.5% to ₹48,912 per 10 gram, after rising 0.55% in the previous session. Silver also came off highs. Silver futures on MCX dropped 1.2% to ₹52,408 per kg after surging 3.3% in the previous session. Gold prices had hit a new high of ₹49,348 per 10 gram last week in tandem with a rally in global markets.
In global markets, gold rates eased lower today, weighed down by a stronger dollar but concerns over surging coronavirus cases around the world capped losses. Gold slipped 0.2% to $1,798.52 per ounce while US gold futures fell 0.7% to $1,802.20. Among other precious metals, platinum rose 0.6% to $833.14 while silver edged 0.1% lower to $19.07.
The dollar index rose 0.1% against its rivals, making gold more expensive for holders of other currencies.
"Gold has come off recent highs and we may need fresh trigger to build the momentum to breach recent highs. With mixed factors in place at present, we may see choppy trade. However buy on dips is recommended as rising virus cases and US-China tensions may keep price supported," Kotak Securities said in a recent note.
US-China tensions also supported gold. Tensions also grew between the United States and China over disputed claims to offshore resources throughout the South China Sea, with U.S. officials saying China's claims were "unlawful."
Gold is often used as a safe store of value during times of political and financial uncertainty. Reflecting the strong investment demand, the holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund or gold ETF, said its holdings rose 0.3% to 1,203.97 tonnes.
Across the world, more than 1.3 crore people have been reported to be infected by the novel coronavirus and 5.7 lakh have died, according to a tally posted on Johns Hopkins University.
As cases in the US continued to rise, California Governor on Monday ordered a massive rollback of the state's reopening on Monday in hardest-hit counties. (With Agency Inputs)