Gold price rises for second day; silver rates at Rs 70,300
Rupa Burman Roy August 18, 2020
Gold, Silver prices in India on August 18: Gold price in India gained for the second consecutive session today amid recovery in global markets as the US dollar weakened and US treasury yields pulled back. Prices of the bullion metal were falling last week after dollar had gained some ground.
Overseas, gold and silver prices recovered from the worst fall in seven years as investors digested news over US-China row and US stimulus talks.
US President Donald Trump's administration announced Monday a further tightening of restrictions on Huawei, aimed at limiting the Chinese telecommunications giant's access to commercially available chips.
Lingering concerns over a US coronavirus stimulus bill have also kept investors pessimistic. Both Democrats and Republicans have indicated they are at a stalemate over a new stimulus package.
On the Multi-Commodity Exchange, gold September Futures traded 0.54% or Rs 286 higher at Rs 53,561, after hitting an intraday high of Rs 53,598 against the previous close of Rs 53,275 per 10 gm. MCX gold futures trade almost Rs 2,595 lower than the lifetime high of Rs 56,191 per 10 gm, hit on August 7.
Similarly, Silver September futures were trading Rs 1,155 higher at Rs 70,310 per kg today after they touched an intraday high of Rs 70,499 per kg. Silver Futures hit a lifetime high of Rs 77,949 on August 7.
Overseas, gold prices inched closer to the $2,000 mark today as dollar fell 0.2% to a more than one-week low. Weakness in the dollar was on the back of cautious traders, focusing on minutes from the US Federal Reserve's last policy meeting, set to release this week.
Spot gold rose 0.2% to $1,990.13 per ounce, while Comex gold traded flat at $1,985 per ounce, after hitting $2,063 in the previous session. US gold futures inched up 0.1% to $1,999.70. Silver climbed 1.4% to $27.77 per ounce
Amid the coronavirus-driven slowdown, fuelling fears of inflation and currency debasement have helped the yellow metal gain over 31% in the year 2020.
The bullion metal fell 4.5% last week on US and China tensions and correction in the dollar that continue to weigh on investor sentiment.
Retail gold rate in India
24-carat gold prices in the national capital traded at Rs 55,100 per 10 gram. Price of 24-carat gold stood at Rs 55,300 per 10 gram in Chennai. In Mumbai, the rate was Rs 52,510 for 24-Carat gold, as per Good Returns website.
As per Geojit Financial Services, though the broad bias is on the bullish side, prices are likely to face resistance near $2000 and trigger corrective sell-offs for the day. However, a direct rise above the same would lift the sentiments higher.
For MCX Gold August, resistance is placed at 53,850 and support is at 51,400. For MCX Silver August futures, the resistance is at 71,500/74,980 and the support is placed at 66,200/60,800.
Commenting on Gold's outlook, Hareesh V, Head Commodity Research at Geojit Financial Services said,"Signs of easing US-China trade tensions and hopes of a rebound in the US dollar are likely to weigh on the safe-haven demand of the metal in the immediate run. However, slow global growth prospects amid the rising threat of pandemic continue to provide support to the broad bullish outlook of the commodity."
The uncertainty regarding the fresh US economic relief, the outcome of the US-China trade talks and worsening coronavirus crisis have caused the recent volatility in the commodity markets. Worldwide, there are 220 lakh confirmed cases and 7.77 lakh deaths from COVID-19 outbreak. Meanwhile, death toll in India approached 52,000 mark and total coronavirus stood at 27.01 lakh as of Tuesday.