Gold price today at life-time high of Rs 53,865 per 10 gm; experts predict further rally
Gold price today hit its life-time high of Rs 53,865 per 10 gm at the Multi Commodity Exchange (MCX).
Gold price today hit its life-time high of Rs 53,865 per 10 gm at the Multi Commodity Exchange (MCX). According to the bullion experts, the yellow metal price has been rising due to the US dollar collapsing to the tune of near 5.5 per cent in the last one fortnight while the rising US-China tension has added further fuel in the retail bullion price rally. They said that triggers for the gold price rally are from overseas and by the end of current quarter, precious metal price may hit $2,000 per ounce levels while in domestic markets, gold price may showcase Rs 54,500 to Rs 55,000 per 10 gm.
Speaking on the reason for rise in gold price Amit Sajeja, Associate Vice President at Motilal Oswal said, "Gold price has been rising due to two major reasons — US dollar collapsing as much as 5.5 per cent in the last one fortnight forex trade session and US bond yield almost close to the negative territory." Sajeja said that dollar price crash is combination of weak US economy and rising US-China tension. While the US and its allies are trying to corner China in global merchandise, China is also reacting sharply to that and in result the global economy is getting hit badly. And the rest is being done by Coronavirus as well.
"Due to the traditional investment tools not yielding high returns, global investors have moved towards gold that has made it an investors haven. This is expected to continue and so does the gold price rally," said Sajeja of Motilal Oswal.
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Highlighting other reasons for gold price rise Anuj Gupta, Deputy Vice President — Commodities and Currencies Research at Angel Broking said, "Today gold again made a new life time high of Rs 53,865 levels. Weakness in dollar due to new government data underscored the US GDP and deep economy due to coronavirus and the US president raised the possibility of delaying the November Election. US GDP collapsed at 32.9 per cent during the second quarter and job loss claims rose last week. We expect the Gold trend to remain positive . We expect gold may test the $2000 level soon." He said that by the end of the current quarter gold price is expected to hit Rs 54,500 to Rs 55,000 per 10 gm at MCX.
Likely gold price triggers in focus
"The sentiment across markets is deteriorating. First of all, rising infection rates are a real concern for the globe and a real support for gold prices. Given that, it is also driving the US dollar higher," Reuters reported quoting Michael McCarthy, chief strategist at CMC Markets.
"Gold also saw safe-haven demand as the federal unemployment bonus expired on Friday, which would affect US consumer income and spending and the U.S. Central Bank would thus remain dovish," Phillip Futures analysts said in a note.
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