Gold prices in India rose marginally today, continuing their choppy movement of recent days. On MCX, gold futures prices were up 0.11% to ₹38,045 per 10 gram. Silver also edged higher, rising 0.3% to ₹45,442 per kg on MCX. Though gold prices have corrected nearly ₹1,900 from last month’s high, they are up about 20% so far this year. This has impacted retail demand in India.
In spot markets, prices of 24 karat in gold in Delhi rose ₹75 to ₹38,945 per 10 gram in Delhi while silver prices jumped ₹110 to ₹46,520 per kg, Press Trust of India reported, citing HDFC Securities.
In global markets, gold prices were today steady at $1,491.83 per ounce. The European Union has delayed a decision on whether to grant Britain a three-month Brexit extension. Meanwhile, British Prime Minister Boris Johnson said if the deadline is deferred to the end of January he would call an election. The non-yielding gold is often seen as a safer investment during times of political and financial uncertainty.
Brexit-related development has caused volatility in currency and equity markets in last few days and this may continue in the near term, say analysts.
Gold also drew support from expectations of an interest rate cut from US Federal Reserve later this month. “Fed is largely expected to cut interest rate for the third consecutive time however Fed’s hesitance on starting a monetary easing cycle has caused some uncertainty,” Kotak Securities said in a note.
Some investors moved to the sidelines awaiting further developments on US-China trade talks and Brexit. The holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, continued to decline, falling 0.13% to 918.48 tonnes on Wednesday from 919.66 tonnes on Tuesday.
“Gold continues to trade in a broad range near $1500 per ounce as market players are on sidelines awaiting more clarity on trade, Brexit and central bank monetary policies,” Kotak Securities added.
Back in India, some demand uptick is expected ahead of Dhanteras, which will be celebrated tomorrow. Stock exchanges NSE and BSE will extend the trading session for gold ETFs and sovereign gold bonds on Friday, till 7 pm on the occasion of Dhanteras.
Apart from physical gold and other instruments like gold ETFs and gold funds, investors will have more options to buy gold on the occasion of Dhanteras.
A new tranche of government’s gold bond scheme, which is currently open for subscription, will close tomorrow. The issue price has been fixed at ₹3,835 per gram of gold while investors applying online and making payment online will get a discount of ₹50 per gram. The minimum permissible investment is 1 gram. (With Agency Inputs)