Gold prices have reached yet another high in dollar terms, trading at $1,380 an ounce early on Thursday evening.
On Wednesday, the yellow metal closed at $1,371.1/oz, a rise of 1.6 per cent to a record fresh high. Silver actually outperformed the sister metal to close at 3.1 per cent higher at a fresh 30-year high of $23.98/oz.
Prices gained upward momentum across the board on Wednesday as equity markets extended their gains and the dollar weakened further against the euro to levels not seen since January this year, an expert commented.
For the first time, Indian wholesale prices breached the psychological Rs 20,000 for 10 gm barrier today, but dropped slightly lower towards the close of trading.
For the time being, short-term investor interest remains supportive of gold prices testing new highs. Technical analysts have noted that gold in dollar terms needs a sustained break above $1,370/oz so as to be able to test higher highs.
At prices close to record Rs 20,000 for 10 gm, physical demand in price- sensitive markets such as India is sure to take a beating. However, Indian market simply follows global cues. There is continued investor interest in gold because of macroeconomic pessimism and weaker equity markets.
There is belief that it is only a matter of time before gold breaches $1,400/oz. However, profit-taking could emerge enroute and result in correction, albeit temporary.
Reuters reports: Gold rallied to fresh record highs in Europe on Thursday as the dollar slid to its lowest this year versus a basket of major currencies, boosting interest in the metal as a haven from currency market volatility.
Spot gold hit a high of $1,387.10 an ounce and was bid at $1,381.45 an ounce at 11:58 GMT. US gold futures for December delivery were up $11.90 at $1,382.40, having peaked at $1,388.10 an ounce.
Palladium rallied to a fresh 9-year high at $603 an ounce. Palladium was at $597 against $590.45, while platinum was at $1,714 an ounce.
Bullion rate
Mumbai: Silver spot (.999 fineness): Rs 37,365; standard gold (99.5 purity): Rs 19,880; pure gold (99.9 purity): Rs 19,975.
Chennai: Bar silver (a kg): Rs 37,080; retail silver (a gm): Rs 39.65; standard gold: Rs 20,050; retail ornament gold (22 carat): Rs 1,865.
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