Gold prices fall today, silver rates slump
New Delhi-India (Oct 8) Gold prices today edged lower, tracking a weak overseas trend and subdued demand from local jewellers. But silver prices recorded a sharp fall amid reduced offtake by industrial units and coin makers. Gold prices fell by Rs 30 to Rs 31,870 per 10 gram while silver rates slumped by Rs 500 to Rs 39,300 per kg, according to a report from Press Trust of India. Sovereign gold, however, remained flat at Rs 24,600 per piece of 8 gram.
Silver ready tumbled by Rs 500 to Rs 39,300 per kg and weekly-based delivery by Rs 420 to Rs 38,555 per kg, the report added. On the other hand, silver coins maintained a steady trend at Rs 73,000 for buying and Rs 74,000 for selling of 100 pieces.
In global markets, gold prices fell partly in response to gains in the dollar which is benefiting from a run of strong US economic data. Spot gold was down 0.7% at $1,193.81 an ounce. A stronger dollar makes dollar-denominated gold more expensive for holders of other currencies.
Global equity markets were weak today as investor confidence took a knock from last week’s spike in US Treasury yields and concerns about an escalating trade war between the United States and China.
“Weakness in emerging markets might bring in small bids for gold,” said Nicholas Cawley, an analyst at DailyFX.com, adding that the “overriding factor is higher U.S. interest rates and bond yields.”
“(Gold) trading below all major moving averages. The weaker yuan and higher dollar index are both negative for the metal and the path for gold looks lower.”
Globally gold prices have fallen 12% from a peak in April largely due to the dollar’s strength and rising US interest rates.
Gold is highly sensitive to rising rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.
Higher domestic prices, partly a result of the falling rupee, dented demand for physical gold in India, say traders. But India’s gold imports are expected to rise this quarter as demand usually strengthens at the end of the year, driven by the wedding season and major festivals.
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