Gold prices today struggle after big fall, silver rates edge higher2 min read . Updated: 14 Oct 2020, 09:09 AM IST
- Analysts say that gold will remain supported at lower levels
- US election outcome, its impact on the US dollar, clarity on the covid vaccine will give broader direction to gold, say analysts
Gold price in India struggled today after a sharp fall in the previous session while silver edged higher. On MCX, December gold futures were up 0.19% to ₹50,343 per 10 gram while silver futures moved 0.3% higher to ₹60,738 per kg. In the previous session, gold prices had slumped ₹850 per 10 gram while silver had plunged ₹2,600 per kg. In global markets, gold prices were little changed today but remained below the key $1,900/ounce psychological level.
A stronger US dollar weighed on the precious metal. Spot gold was trading at $1,892.80 per ounce, after declining 1.6% in the previous session. The dollar index was steady today after rebounding from three-week low on Tuesday.
Among other precious metals, silver rose 0.2% to $24.22 per ounce while platinum was up 0.5% at $869.05.
Prospects for US fiscal stimulus before next month’s election have dimmed , with House Speaker Nancy Pelosi demanding the Trump administration revamp its latest offer. Pelosi rejected a $1.8 trillion proposal from the White House, saying it "falls significantly short of what this pandemic and deep recession demand."
Equity markets struggled today as halted vaccine trials and an elusive U.S. stimulus agreement weighed on investor sentiment.
Analysts say that gold will remain supported at lower levels. "Gold is considered as a safe haven and a hedge against inflation. Investors will continue to flock until clarity emerges on the global economic recovery," says Nish Bhatt, Founder & CEO, Millwood Kane International, an investment consulting firm.
"Moving forward, US election outcome and its impact on the US dollar, clarity on the covid vaccine will give broader direction to gold," he added.
Analysts say that investors turned to the greenback as a haven after a setback in a Covid-19 vaccine trial and deadlocked talks on US economic stimulus.
"Amid other factors, gold remains supported by uneven global economic recovery, rising virus cases. Gold may remain choppy as equity markets and US dollar are likely to remain volatile amid uncertainty relating to US stimulus package and US Presidential elections," Kotak Securities said in a note.
Gold prices started to lose momentum after hitting a record high in August as the dollar gained. In India, gold had hit a record high of ₹56,200 in August while silver had rallied to almost ₹80,000 per kg.
The latest issue of sovereign gold bond, which opened for subscription on Monday, will close on Friday. Govt of India is selling gold at ₹5,051 per gram. Investors who apply and make payment online get a small discount.