Gold prices hit another new high, silver rates rise
Gold continued its record-breaking run in Indian markets with prices today hitting yet another high. On MCX, October gold futures were up 0.2% to ₹53,865 per 10 gram. Silver futures on MCX also advanced 0.18% to ₹65,865 per kg. In the previous session, gold prices had risen 0.5% or ₹267 per 10 gram while silver had surged 1.2% or ₹800 per kg. Gold had hit an intraday high of ₹53,845 per 10 gram in the previous session.
In global markets, spot gold was steady at $1,976.36 per ounce, $8.30 shy of the all-time high hit in the previous session. Concerns over the impact to global economy from mounting COVID-19 cases offset pressure from a rebound in the US dollar. The World Health Organization has warned that there might never be a “silver bullet” for COVID-19 in the form of a perfect vaccine and that the road to normality would be long.
“Precious metals seen moderately lower on recovering dollar. However, worries of economic growth owing to rising virus infection continue to boost gold’s demand,” Geojit Financial Services said in a note.
Industrial metals dipped on dollar recovery and concerns over economic restoration despite an expansion factory activity in China, the top consumer of industrial metals, the brokerage added. Silver, which has some industrial use, fell 0.1% to $24.22 per ounce while platinum rose 0.2% to $918.50.
The US dollar recovered against key rivals today after hitting a two-year low last week. The dollar index today rose 0.1% against its rivals, A stronger US dollar makes gold more expensive for holders of other currencies.
Meanwhile, data showed that US manufacturing activity accelerated to its highest level in nearly 18 months in July as orders increased despite a resurgence in new COVID-19 infections. Further lifting risk sentiment, top Democrats in the U.S. Congress and White House negotiators on Monday said they had made progress in talks on a new coronavirus relief bill.
In global markets, gold and silver prices are up 30% this year and are among the best performing asset classes, supported by unprecedented stimulus measures from central banks and lower interest rate. Inflows into gold ETFs have seen a strong surge this year as the yellow metal is seen as a hedge against inflation and fears of currency debasement. (With Agency Inputs)