Gold outlook: Yellow metal’s surge to continue; these 2 factors may boost prices in 2020

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Published: October 30, 2019 6:57:12 PM

Even as the prices of over half of the major commodities fell owing to the global slowdown, gold rates rose in the third quarter of 2019.

Gold Amnesty Scheme, गोल्ड एमनेस्टी स्कीम, to curve black money govt may announce gold amnesty scheme, demonetisation, tax on gold, penalty on unknown gold The prices received a boost from robust physical demand, interest rate cuts by the US Fed and increased global policy uncertainty.

Even as the prices of over half of the major commodities fell owing to the global slowdown, gold rates rose in the third quarter of 2019. The prices of yellow metal surged 12.6 per cent in 2019 Q3, following three consecutive quarterly gains, CARE Ratings said in a report. The prices received a boost from robust physical demand, interest rate cuts by the US Fed and increased global policy uncertainty, it added. Even the central bank purchases and investor holdings in gold-backed exchange-traded, funds, and jewelry sales, especially in India have increased over the period. In 2020, the gold prices are expected to gain nearly 6 per cent owing to more expansionary monetary policies and robust demand, the report expected.

“Mirroring the trajectory in gold prices, silver prices increased 14.3% in 2019 Q3. Prices were supported, in part, by increased purchases in India. Furthermore, gold’s premium to silver boosted investment and jewelry demand of the latter. Silver prices are forecast to average 4.9% higher in 2020, following an expected increase of 3.1% in 2019,” CARE Ratings said.

Also read: Stock markets extend gains to 4th day; Sensex tops 40,000; key reasons

Meanwhile, even as both Sensex and Nifty ended the Hindu calendar year Samvat 2075 with modest gains, gold and silver outperformed equities with returns of over 21 per cent each. Gold returned 21.9 per cent gains this year as against last year’s Diwali Similarly, silver delivered 16.6% return since last Diwali. While the Sensex jumped 4,066.15 points or 11.62 per cent, the Nifty surged 1,053.90 points or 10 per cent in Samvat 2075. The stock markets were generally a choppy ride during the given period on account of several domestic and global concerns. On Friday, the last trading day of Samvat 2075, the Sensex settled 37.67 points, or 0.10 per cent, higher at 39,058.06. The  Nifty closed at 11,583.90, up by just 1.30 points or 0.01 per cent.

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