Gold prices in India edged higher today after suffering a big fall in the previous session. On MCX, gold futures were up 0.4% to ₹46,853 per 10 gram. In the previous session, gold had hit a record high of ₹47,980 but could not sustain the gains, ending 1.5% or ₹705 lower. Silver prices edged lower today with futures on MCX down 0.14% to ₹47,633 per kg. Gold prices in India include 12.5% import duty and 3% GST. India imports most of its gold requirements.
In global markets, gold prices inched higher today, supported by US-China tension and worries about the economic impact of coronavirus crisis. However, some positive news from an early-stage trial for a coronavirus vaccine helped improve global risk sentiment and capped gold's rise.
Spot gold was up 0.2% at $1,735.04 per ounce. In the previous session, gold fell from a seven-year high to settle 0.5% lower, as stocks and oil surged after drugmaker Moderna said its experimental vaccine showed promising results in an early-stage trial.
Among other precious metals, platinum today fell 0.5% to $814.01, and silver fell 0.5% to $17.09.
Highlighting worries about global economy, head of the International Monetary Fund said that the world will take much longer to recover fully from the shock caused by the new coronavirus than initially expected.
Highlighting China-US friction, Nasdaq is set to unveil new rules for initial public offerings including tougher accounting standards that will make it more difficult for some Chinese companies to list on the exchange, Bloomberg reported.
Nish Bhatt, founder & CEO of Millwood Kane International, attributed the recent rally in gold prices to uncertainties due to COVID19 and tensions escalating between U.S & China which could lead to further trade tariffs. Reports of further stimulus by U.S on the back of economic trouble is also one of the reasons for the spike in gold prices, he added.
Gold is up about 14% this year in global markets as central banks rolled out unprecedented stimulus and a wave of rate cuts to limit the economic damage from the pandemic. Lower interest rates reduce the opportunity cost of holding non-yielding gold. (With Agency Inputs)