Gold surpasses US$1800 for first time since November 2011

Marco Green
July 9, 2020

A sharp global rally in gold on Wednesday pushed the spot price in Mumbai's Zaveri Bazar to a new all-time high of Rs 48,925 per 10 gram (standard gold), up 1.4 per cent.

Worldwide gold gave the much-awaited breakout above $1,800 per troy ounce and closed with more than 1 percent gain at $1,809.90 per troy ounce the previous day. At 12:04 pm, gold futures quoted at Rs 47,997 per 10 grams, down 0.10 per cent compared to their previous close, while silver futures were up 0.05 per cent at Rs 49,204 per kilogram. Silver futures also moved on a listless note. USA gold futures fell 0.4 percent to $1,782.30. However, losses were capped amid rising coronavirus cases globally, analysts said.

"We expect both the precious metals to remain firm and any downside correction in the prices will be an opportunity to buy again".

In the worldwide market, gold rates eased on Monday as risk sentiment improved ahead of U.S. services sector data, although losses were capped by worries over surging COVID-19 cases in some USA states.

"On MCX support for gold prices is placed at Rs 47,500 levels while resistance is seen at Rs 48,350 levels", Kedia added.

India on Monday overtook Russian Federation to record the world's third-highest number of Covid-19 infections, while U.S. coronavirus deaths crossed 130,000 amid a surge in cases. Silver rose 0.5 per cent to $18.30.

Domestic bullion could start flat on July 8, tracking a subdued start in the global markets. "On the MCX, it may test Rs 51000 to Rs 52000 levels". However, volatility will keep prices in the 48,100-48,900 range.

Expert: Ravindra Rao, VP- Head Commodity Research at Kotak Securities.

The flight to safety theme, in the face of rising coronavirus cases and regional lockdowns globally, drove Gold close to $1,800, its highest level since November 2011, though the U.S. dollar saw some recovery. However, supporting the price is the increasing concern about virus risks, downbeat growth outlook, choppiness in global equity markets, and ETF inflows.

Other reports by Click Lancashire

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