The precious metal hit a new 25-year high when gold for immediate delivery rose as much as $3.11, or 0.6%, to $571.46 an ounce, the highest since January 1981. In Mumbai, gold prices hit a new all-time high of Rs 8,210 per 10 grams, breaching the previous high of Rs 8,145 on December 21.
Spot silver too hit a new high by closing at Rs 13.400. Previous record high for silver was Rs. 13,365 on December 21. In the global market, silver for immediate delivery rose as much as 0.7% to $9.91 an ounce and is expected to hit $10-mark, soon.
Pure gold (99.9 purity) began the day with a huge gap at Rs 8,190 and soared to close at Rs 8,210, higher by Rs 100 over Monday's close. Standard gold (99.5 purity) too, opened sharply higher at Rs 8,150 and ended at a new high of Rs 8,170, again higher by Rs 100 over Monday's close. Despite being the world's biggest consumer of the yellow metal, India does not directly influence prices as international sellers and funds dominate the gold market.
THAT EXTRA SHEEN
Geo-political happenings globally have led to the recent rally in the precious metals. Iran this month resumed research into the nuclear fuel cycle, after talks with the three European Union countries collapsed in August. The EU and US suspect the Iranian government intends to build an atomic bomb, while Iran says its nuclear program is solely for electricity. Gold's may rise further if the US Federal Reserve statement on the economy later on Tuesday proves to be more pessimistic than investors expect. A pessimistic outlook for the world's biggest economy would weaken the dollar. Some investors buy gold as a hedge against declines in the dollar. The Fed's statement is due to be released at 2:15 p.m. Washington time.