The gold prices surged on Wednesday amid global tensions and weak rupee. Yesterday, the gold prices fell for the first time in four sessions. The yellow metal prices are getting support from the improvement in domestic demand and pressure in equity markets, according to market experts. Currently, the MCX gold is trading at Rs 31,658 per 10 gram, up 118 points from the previous close.
“Market is in no mood to stay below $12,80 per ounce in international market because of ongoing global tensions and better demand in the domestic market. Good monsoon predictions for this year is also likely to increase the rural demand,” Ajay Kedia, Director of Mumbai-based Kedia Commodities told Financial Express Online.
“Prices are higher today because of the gold buying which happened yesterday after the prices declined and weakness in rupee.US-China burgeoning trade tension also pushed the prices higher. Global equity markets are also under pressure which is positive for gold prices.Gold will remain above Rs 31500 per ten gram and may bounce up to TRs 31800 per ten gram,” Kedia further added.
This is a good time to invest in gold on the back of good monsoon prediction and pressure in global equity markets. Demand for yellow metal is also good due to wedding seasons, Jigar Trivedi, Fundamental Analyst- Commodities at Anand Rathi Shares and Stock Brokers told Financial Express Online.
Today, the rupee opened lower at 69.75 per dollar against the previous close of 69.69. Yesterday, the rupee came under pressure amid rising trade tensions between the two superpower economies- the US and China and rising crude oil prices.According to market experts, the escalating trade worries between the two economic giants- the US and China would linger for a long period of time. US President Donald Trump on Monday said the US was not ready to make a deal with China and the trade tariffs might go up considerably. However, he also said that he expected a deal in future. The yield on the benchmark 10-year Treasury note plunged to a 19-month low on Tuesday as Wall Street feared that the US-China trade war would last longer and adversely affect the GDP growth.