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Home >News >India >Gold prices today hit record high, surge about 1,500 per 10 gram in 2 days

old prices in India touched new highs today, crossing the 46,700 level per 10 gram in futures market. On MCX, June gold futures rose as much as 1% to a new high of 46,785 per 10 gram before closing 0.9% higher at 46,716. In the previous session, gold prices in India has surged over 2% to 46,255 per 10 gram, hitting a new high of 46,385 during the session. Indian commodity derivative markets were closed on Tuesday for a holiday. May silver futures on MCX today rose over 0.75% to 44,076 per kg.

In global markets, gold prices held on near seven-year highs hit in the previous session. Spot gold was trading at $1,727.59 per ounce, after coming closer to $1,750 in the previous session. Fears of a deeper global recession due to the impact of coronavirus supported the safe-haven appeal of gold. Among other precious metals, silver dropped 1.1% to $15.64, while platinum advanced 1.1% to $783.25 an ounce.

Hareesh V, head of commodity research at Geojit Financial Services, said: "Gold’s bullish outlook is likely to continue due to fears of a possible global recession and large scale quantitative easing programs taken by various central banks. Investors will continue to seek shelter in safe assets like gold to protect from the negative economic impact of coronavirus pandemic. Conversely, limited physical market activities and a strong dollar may put downside pressure on prices."

In terms of technicals, bullish sentiments will continue as long as prices (London spot) stay above $1702, he said. "Immediate resistance is seen at $1746, and a direct break above the same would take prices higher to $1758 followed by $1800 levels. Immediate downside turnaround point is seen at $1672."

The International Monetary Fund in its latest forecast has predicted that the global economy may shrink by 3% in 2020 due to the virus outbreak, in what could be the worst downturn since the Great Depression of the 1930s.

Gold exchange traded funds or ETFs continued to see inflow. The holdings SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.8% to 1,017.59 tonnes on Tuesday.

In global markets "the disparity between spot and futures continue as virus related restrictions affect consumer demand in physical market while deliveries on futures counter are likely to be constrained due to supply issues," Kotak Securities said in a recent note.

"While overall sentiment is positive, we suggest waiting for corrective dips as increasing risks from virus outbreak may underpin US dollar. The US dollar remains supported by safe haven buying as global virus cases continued to rise increasing further health and economic risks for global economy," the brokerage added.

In India, the Reserve Bank has announced the issue dates of the sovereign gold bond scheme 2020-21 for the first six months of the new fiscal, April to September. The RBI will come out with an issue every month, issuing bonds in six tranches, beginning 28 April.

Sovereign gold bonds have a tenure of eight years, with exit options are available from the fifth year.

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