Gold hits record high of Rs 47,861 per 10 gram, silver up Rs 3,000 per kg

Mumbai-India (May 18)  Gold prices extended their gains for the sixth consecutive day to hit a new record high of Rs 47,861 per 10 gram in the Mumbai bullion market on a weaker rupee versus the dollar. The yellow metal edged up on increased US-China tension and weak economic data boosted its safe-haven appeal.

The rate of 10 gram 18, 22 and 24-carat gold in Mumbai was Rs 35,896, Rs 43,841 and Rs 47,861 plus 3 percent GST.

According to Navneet Damani, Vice President, Motilal Oswal, gold inched higher to its highest since October 2012 as worries regarding the souring US-China relations and bleak US economic data underpinned the safe-haven metal. He expects domestic prices to hover in the range of Rs 47,600-48,050.

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Ravindra Rao, VP-Head Commodity Research at Kotak Securities, too expects gold to continue to trade with a positive momentum unless there is an improvement in the virus-related situation or easing of US-China trade tensions.

Tapan Patel, Senior Analyst (Commodities), HDFC Securities, said gold prices continued to rally on safe haven buying on economic growth concerns and tensions between the US and China. He added that weak economic data from US and Federal Reserve's warning of dip in the GDP numbers spurred buying in precious metals.

The gold/silver ratio currently stands at 99.46 to 1, which means the amount of silver required to buy one ounce of gold.

Silver prices gained Rs 3,085 to Rs 48,120 per kg from its closing on May 15.

In the futures market, gold touched an intraday high of Rs 47,980 and an intraday low of Rs 47,560 on the Multi-Commodity Exchange (MCX). For the June series, the yellow metal touched a low of Rs 36,572 and a high of Rs 47,980.

Gold futures for June delivery gained Rs 488, or 1.03 percent, at Rs 47,869 per 10 gram in evening trade on a business turnover of 12,764 lots. The same for August delivery jumped Rs 515, or 1.08 percent, at Rs 48,084 on a business turnover of 9,235 lots.

The value of the June and August contracts traded so far is Rs 2,879.02 crore and Rs 354.97 crore, respectively.

Similarly, Gold Mini contract for June rose Rs 500, or 1.06 percent, at Rs 47,852 on a business turnover of 10,449 lots.

Patel sees support for MCX Gold June contracts at Rs 47,300 and resistance at Rs 48,200 levels. Similarly, Motilal Oswal sees support at Rs 47,550 and Rs 47,700 levels. It has advised its clients to buy on dip targeting higher resistance in the Rs 48,000-48,150 zone.

At 12:07 pm (GMT), spot gold was up by $11.58 at $1,754.60 an ounce in London trading.

MoneyControlNews

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