Gold prices jumped to Rs 44,772 per 10 gm in Indian commodity market MCX today, tracking support from international spot gold, as rising cases of coronavirus and fall in crude oil price threatened to lock down the global economy.
Gold Futures on MCX rose Rs 614 points to the day's high of 44,772 per 10 gm. Later, the precious metal was trading at Rs 44,200 per 10 gm, rising Rs 42 against the opening of 44,158 today.
Since last Monday on March 2, 2020, gold on MCX futures has risen by Rs 2,761 from Rs 41,397 per 10 gram to today's opening price of Rs 44,700.
Gaining ground on geopolitical tensions, retail gold price for 24 karats in Delhi, spiked to a record Rs 45,200 per 10 gm today.
Internationally, Spot gold jumped to its seven-year high, rising 1.6% to $1,700.66 per ounce. Compared by the last close of $1,688 per ounce on Friday, Spot gold has risen 6.4% in a week's period and 11.2% since the beginning of the year, 2020.
The yellow metal that was already gaining on coronavirus fears over the recent period, gained further momentum as global economic sentiments worsened on back of a drastic 31% drop in crude prices.
The safe-haven bet is heading for its best weekly gains as worries over a rising number of coronavirus cases globally made investors rush to safe-haven assets. Besides this, the virus outbreak has caused a decline in demand for crude.
A plunge in crude oil price threatened global traders' sentiments on Monday, that led to resuming trade in the precious metals. Gold prices have gained consecutively in the past week as investors seek refuge in risk-averse assets.
Brent crude, the international benchmark, dropped from $45 a barrel to $31.52 a barrel, registering a fall of 31% in a matter of seconds. This was after Saudi Arabia started a price war with Russia, cutting the crude price in the wake of falling demand due to the rising number of coronavirus cases globally.
Crude oil prices may continue to remain under selling pressure as worries about demand for fuel being sapped by the global coronavirus outbreak, SMC Global said in its report.
"Gold may move towards 45,800 levels while taking support near 43,500 levels and silver can test 48,900 levels while taking support near 47,000 levels," it further added.
The report further added that India's gold imports have plunged 41% in February from a year earlier as a rally in local prices to a record high squeezed retail demand. The world's second-biggest consumer of gold imported 46 tonnes in February, compared with 77.64 tonnes a year earlier.
The virus outbreak, which originated in China and was expected to be a one-quarter affair for China's economy, has now spread worldwide. It has caused around 3,800 deaths, with a number of infected cases rising to 110,041 today. Although, of this, 61,000 have been recovered worldwide. The number of coronavirus cases in India reached 43 on Monday.