Silver prices also rose in tandem, and were quoted at $4.83/4.85 an ounce, up from $4.81/83 at close in New York on Tuesday. Platinum was quoted at $639.00/644.00 an ounce (from $629.50/636.50 an ounce) and palladium at $263.00/270.00 (from $260.00/268.00).
During the day, however, the bullion prices had slid slightly.
Traders and bullion bankers feel that gold prices could zoom further to around $375-80 per troy oz levels, and may even cross $400/oz levels if a war breaks out between the US and Iraq. But if there is no war, the prices could slide to around 345-350 levels, they said.
Interestingly, despite gold prices zooming, retail gold jewellery buyers and owners in Mumbai turned sellers and were seen queuing up throughout the day in front of various jewellers shops in and around Zaveri Bazar to cash in on the rising gold prices.
Golds on a one-way street, said a source from a leading bullion bank. It is surprising that the prices are still at current levels and have not yet crossed $365 levels, the source added.
Mr Asish Ghia, an independent gold analyst, said, From the beginning of 2003, gold has taken off as one of the best performing financial asset when compared with the US dollar and equities there. As the US dollar is likely to remain weak for a long time, ....gold may go up further.
Since January 15, 2002, gold prices have gained a whopping 26.25 per cent in US dollar terms, while in Indian rupees, gold prices have risen 22.75 per cent.
According to Mr Hundia, there is minimal buying in the local market to meet the requirements during the on-going marriage season. However, in Japan, gold demand is huge, especially because of the zero-interest rates there. Even in the US, because of weak dollar and equities, investors have been investing more in gold.
With the US and British forces being deployed in the Gulf region in increasing strength, Mr Bush described the UN arms inspections of Iraq as a re-run of a bad movie. Its clear to me now that he is not disarming, Mr Bush said of Iraqi President Saddam Hussein. Time is running out, Bush is reported to have said.