Gold prices today fall sharply, down over ₹1,000 per 10 gram from highs
2 min read . Updated: 23 Mar 2020, 01:01 PM IST
Premium- Gold in India has fallen sharply after hitting a record high of about ₹45,000 per 10 gram earlier this month
- Silver has also seen a sharp fall over two weeks
Reversing early gains, gold prices today fell sharply in Indian markets, tracking a decline in global rates. On MCX, April gold futures fell 1% to ₹39,895 per 10 gram, after rising as much as to ₹40,937 earlier in the session. Silver rates also pared gains and were up 0.16% higher at ₹36,600 per kg. Gold prices in India have seen a sharp correction since hitting a record high of about ₹45,000 per 10 gram, tracking similar movement in global rates. Despite today's upmove in gold prices, the precious metal is down over ₹4,000 per 10 gram in about two weeks in domestic markets.
Gold prices in India include 12.5% import duty and 3% GST. Today, the rupee edged above 76 per US dollar amid a broad strength in the greenback.
In global markets, gold prices were lower today as investors rushed for cash despite announcement of stimulus measures by many central banks to limit the economic damage from the coronavirus outbreak. Spot gold fell 0.7% to $1,487. Among other precious metals, silver slipped 0.9% to $12.47 per ounce while platinum rose 1.2% to $618.50. Gold prices on Friday had risen as much as 3.1% on Friday as a wave of fiscal and monetary stimulus from central banks across the globe temporarily halted a run for cash.
"Technically, possibilities of recovery moves in gold are still open as long as prices stay above $1460. However, there is a stiff resistance is seen at $1,545 which needs to be cleared for continuation of strong rallies. A close below $1445 could negate further bullish expectation and trigger major liquidation pressure," Geojit Financial Services Limited said in a note.
As more countries opted for lockdowns to combat the spread of coronavirus, Asian shares sank today amid fears of a global recession. E-Mini futures for the S&P 500 dived 5% at the open to be limit down.
Meanwhile, global death toll from coronavirus exceeded over 14,000 with more than 300,000 infections.
"Investors have been liquidating in favour of holding cash, with asset classes from gold to government bonds getting affected. The spread of coronavirus and the extent of its impact continue to worry investors. Although central banks around the world have announced several measures to shield their countries from the economic fallout of coronavirus, ranging from rate cuts to liquidity boosters to cash in hand proposals, these have not been enough to calm the markets," said Vinod Nair, Head of Research at Geojit Financial Services.
A surge in US dollar against major currencies today also weighed on gold. Indicative of the investor sentiment, hedge funds and money managers reduced their bullish positions on COMEX gold contracts in the week to March 17, the US Commodity Futures Trading Commission (CFTC) said on Friday. (With Agency Inputs)
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