Gold prices on Wednesday rose Rs 300 to near the Rs 40,000 per 10 gm mark yet again. The yellow metal was at Rs 39,970 per 10 gm, according to the All India Sarafa Association. Gold had touched a little over Rs 40,000 earlier this week.
The international spot gold prices traded above $1540 while the MCX Gold Oct futures made a high at Rs. 39,390 after opening at Rs 39,044. The MCX Gold Oct 2019 Futures had closed yesterday at Rs 39,167.
Gold prices have been hitting fresh highs since its uptrend rally from August 20 onwards. Additionally, a weaker rupee against the US dollar also helped to support the precious metal's rally with investors focussing more on safer assets.
Following the current price appreciation of gold, silver prices rallied more than 1% to $18.40 on high investment demand. In the domestic market, silver soared Rs 2,110 to Rs 48,850 per kg, while weekly-based delivery jumped 1,289 to Rs 46,416 per kg, backed by fresh offtake by industrial units and coin makers.
"This chronic increase in gold rates has been happening for the past 1.5 to 2 months now," quoted Rupesh Jain, Founder and CEO, Candere, adding that, "One of the major factors that are affecting this rate is the trade war between the USA and China. The longer it persists, the more fluctuations we will see. Besides, the increase in import duties has also contributed to this. Moreover, the poor returns of the equity market have forced the investors to drift to gold."
"Feeble global equities and signs of escalating fragile global economic sentiments prompted investors to find shelter in safe assets like the yellow metal," quoted Hareesh V, head (commodity research), Geojit Financial Services.
Reacting to the trend from the precious metal, gold analysts are now predicting gold to breach the USD 2,000.00 per oz barrier by 2020.
Edited by Rupa Burman Roy