Home / News / India /  Gold prices today surge 1,000 per 10 gram, hit record high

Gold prices in India hit a record high in futures markets today amid higher global rates though physical buying remained suspended in domestic markets due to the 21-day lockdown. On MCX, June gold futures surged over 2% to a new high of 46,385 per 10 gram at day's high before closing 961 higher at 46,255. May silver futures rose 0.5% to 43,725 per kg. Gold prices in India include 12.5% import duty and 3% GST. India imports most of its gold requirement.

Gold may witness some profit-taking at higher levels but overall trend looks positive, SMC Global said in a note, adding that MCX gold has support at 45,000 while silver has support near 42,500.

In global markets, gold rates were flat today but managed to hold on to near a one-month high. Worries over economy amid the coronavirus outbreak and fresh stimulus measures announced by US Federal Reserve last week helped support gold. Spot gold were flat at $$1,690 per ounce. Among other precious metals, silver gained 0.5% to $15.40, while platinum eased 0.3% to $745.74.

Large scale quantitative easing measures taken by various central banks have lifted gold higher, says Hareesh V, head of commodity research at Geojit Financial Services.

"Investors’ demand for safe havens due to fears of a global recession amid the negative economic impact of COVID 19 will also support the yellow metal. At the same time, moderate physical activities and a strong dollar may limit major gains," he added.

On technicals, he said, bullish momentum may continue as long as prices (London spot) stay above $1,642. "Intra-day resistance is seen at $1695, a direct break above the same would lift prices higher to $1705 or even more towards $1740 levels. Immediate downside turnaround point is seen at $1,620," Mr Hareesh said.

Last week, the US Federal Reserve announced a $2.3 trillion stimulus package to bolster local governments and small and mid-sized businesses. Also on Thursday, European Union finance ministers agreed on half-a-trillion euros worth of support for their coronavirus-battered economies.

Investment demand for gold continued to rise. The holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.56% to 994.19 tonnes on Thursday.

Gold-backed ETFs are passive investment instruments that are based on price movements and investments in physical gold.

In India, physical buying of gold remained suspended amid a three-week lockdown. Jewellers are not placing orders even for May delivery due to the uncertainty over its extension, Reuters quoted a Mumbai-based dealer as saying. India's gold imports plunged more than 73% year-on-year in March as record prices and the lockdown squeezed retail demand. (With Agency Inputs)

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