Gold prices near 3-year high on heavy buying by jewellers

Mumbai-India (Sept 7)  Gold and silver prices gained sharply on Wednesday tracking global cues and heavy buying by Indian jewellers, adding to the bullish sentiments prevailing on the stock markets. The yellow metal spurted Rs. 450 to hit a 30-month high of Rs. 31,550 per 10 gm, while silver prices rose Rs. 750 to Rs. 46,950 per kg.

The buoyancy in sentiments led to the biggest daily rise in gold prices since June, aided by lower chances of an interest rate hike by the U.S. Federal Reserve, leading to higher demand for the safe-haven metal, reported PTI.

Falling gold imports is bad news for India

Smuggled gold could account for more than a third of demand this year in India potentially costing the government over $1 billion in lost revenue. [Representational image] A salesman arranges a gold necklace in a display case inside a jewellery showroom on the occasion of Akshaya Tritiya, a major gold buying festival, in Kolkata, India, May 9, 2016.

Gold smuggling affecting refiners and banks, official imports hit two-decade low

Silver coins gained Rs. 1,000 to close at Rs. 77,000 for buying and Rs. 78,000 for selling of 100 pieces.

Gold prices closed at Rs. 30,950 per 10 gm and silver at Rs. 44,900 per kg on Sept. 1, 2016.

In the global market, gold prices in Singapore increased marginally to $1,352.16 per ounce on Wednesday after rising 1.7 percent the previous day.

The price of the sovereign gold bond issued in the first tranche and listed on June 13 closed at Rs. 3,160, translating into a gain of 17 percent when compared to the issue price of Rs. 2,684 representing 1 gm of gold.

The fifth tranche opened on Sept. 1 and closes on Sept. 9.  The Reserve Bank of India has fixed Rs. 3,150 per 1 gm of gold as the issue price, the highest since the first tranche. The minimum investment is 1 gm and the maximum limit is 500 gm.

The government launched the sovereign gold bond (SGB) scheme last November as part of an initiative to discourage people from investing in physical gold and unlock the yellow metal lying with households and institutions, mainly temples.

Read: Sovereign gold bonds yield 20% return in three months of listing

On Wednesday, The BSE Sensex closed 52 points lower at 28,926 and the NSE Nifty lost 25 points to end at 8,917.

State Bank of India, ONGC and ICICI Bank remained the top Sensex gainers, while Asian Paints, Axis Bank and HDFC ended with losses.

Source: IBtimes