Gold prices in India fell for the second week in a row as optimism over the covid vaccine and uncertainty over the US stimulus package weighed on global rates. MCX gold futures on Friday ended up 0.5% at ₹50260 per 10 grams while silver deposited 1.2% higher at ₹62260 per kg. However, for the week, gold prices ended around ₹700 by 10 grams less in Indian markets as silver plummeted ₹1500 per kg.
The price correction helped boost buying in India’s retail gold market this week, Reuters reported, although premiums eased slightly from last week. Dealers have charged premiums of around $ 2 an ounce over official domestic prices, down from $ 4 last week. Gold prices in India include 12.5% imports and 3% GST.
In August, gold hit a record high of ₹56,200 per 10 grams.
Jeweler Titan Company announced a growth in its business this week during the holiday season. “The jewelry business has seen growth in mid-teens (around 15%) for the 30-day holiday season from Dussehra through Diwali during the corresponding period last year, with a decent recovery in sales of studded jewelry, ”the company said in One Business. update.
In global markets, gold edged higher on Friday after US Treasury Secretary Steven Mnuchin said stimulus negotiations would continue, making the metal more attractive as a hedge against likely inflation. Spot gold rose to $ 1,871.99 an ounce, but on a weekly basis, it edged down 0.8%.
However, global gold rates have fallen by about 5% since positive COVID-19 vaccine reports from Pfizer and Moderna over the past 12 days. Gold has mainly benefited this year from the damage done to economies by the pandemic and the resulting global recovery. Gold is viewed by many as a safe haven asset, inevitably pushed higher in times of crisis.
“Prices continue to be volatile within the 1900-1850 $ levels and breaking one side would suggest a new direction for the commodity. MCX Gold is facing resistance at ₹51,220 while support for ₹49,460, ”Geojit Financial Services said in a note.
Investors withdrew $ 4 billion from gold, the largest ever outflow, amid a rush for riskier assets last week, BofA said Friday. (With contributions from the agency)