Gold prices rise today due to RBI rate cut, US-China trade tension, spike in coronavirus cases

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Published: May 22, 2020 12:42:27 PM

On MCX, gold June futures were trading Rs 400 or 0.86 per cent higher at Rs 46,788 per 10 grams, while silver July futures were up just Rs 80 or 0.17 per cent at Rs 47,415 per Kg

Gold, gold pricesToday Reserve Bank of India (RBI) slashed repo rate by 40 bps to 4 per cent which led to a weakening in Indian currency. Image: Reuters

Gold prices surged nearly 1 per cent in Friday’s session on the back of fresh tensions between US-China which made investors rush to safe-haven assets. Besides, a sharp rise in coronavirus (COVID-19)  cases in the country also spooked gold demand. On MCX, gold June futures were trading Rs 400 or 0.86 per cent higher at Rs 46,788 per 10 grams, while silver July futures were up just Rs 80 or 0.17 per cent at Rs 47,415 per Kg. “Gold prices edged higher today after yesterday’s slump due to the US dollar gaining strength against most G-10 currencies. We think this pullback is going to be a nice buying opportunity as the gold markets have been extraordinarily strong as of late,” Bhavik Patel, senior technical research analyst at Tradebulls Securities told Financial Express Online.

Meanwhile, the total number of coronavirus cases in India reached 1.18 lakh mark, with the death toll nearing 3,600. Apart from this, today Reserve Bank of India (RBI) slashed repo rate by 40 bps to 4 per cent which led to a weakening in Indian currency. “This helped gold covering some of yesterday’s loss in MCX,” Patel said. “We continue to recommend buy on dips strategy with intraday recommendation going long around Rs 46,600 with an expected target of 46,850 and stop loss of 46,480,” he added.

“MCX Gold prices, in tandem with the international trend, inched up on Friday, after falling more than 1% in the previous session, as rising concerns over U.S.-China relations weighed on risk appetite, although the metal still looked to be headed for a weekly loss,” said Jigar Trivedi, Fundamental Research Analyst – Commodities, Anand Rathi Shares and Stock Brokers. Globally, spot gold was trading at $1,727.39 per ounce.US gold futures rose 0.3 per cent to $1,726.50. Palladium gained 1.2 per cent to $2,037.40 per ounce. Among other precious metals, Platinum fell 0.6 per cent to $827.62 and silver slid 1.5 per cent to $16.81.

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