Home >Money >Personal Finance >Gold prices are up 6% in the past 15 days; is it the start of another rally?

After witnessing a correction gold prices have again started its upward trajectory. In the last 15 days The MCX spot gold prices have surged around 6% to 46,648 per 10 grams. Internationally, The prices have gone up by 4% to $1781 per ounce. We explain if it is a start of another bull run.

Experts feel as India is hit by the second wave and central banks across the world pump in more money to support economic growth, prices are expected to go atleast in the short-term till things stabilise.

“The rise in the number of covid-19 cases, fear of the next wave coupled with rising inflation in the US, lower yields, weak US Dollar, and the QE program by the US government has also provided strength to the gold prices. The current situation of rising cases threatens to derail the economic recovery in Q1, creating uncertainties. The situation may lead to elevated gold prices in the short term till the situation stabilizes," said Nish Bhatt, Founder & CEO, Millwood Kane International, an investment consulting firm.

“The retail demand in India has been rising due to festive season buying and has also provided support to gold prices. A pick-up in global economic activity will lead to subdued gold prices, but the risk of the second wave, uncertainty remains which may guide gold prices in the longer term," he added.

“The pandemic has forced major central banks to push more liquidity in the market to support the economy and the effects of these factors could lead to higher precious metal prices. Geo-political tension, trade tussle between US and China and other uncertainties hovering around will give a trigger to the precious metal prices," said the quarterly report on precious metals by Motilal Oswal.

Navneet Damani, vice president, commodities research, Motilal Oswal Financial Services Ltd, told Mint in early April that bullish trend is likely to resume soon and dip towards Rs.43,700-44,200, could be used to initiate fresh entry with upside potential to test Rs.50000 followed by new lifetime high Rs.56500."

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