Gold price crosses Rs 64k/10 gm on MCX

HYDERABAD: The rally in gold prices continued in the international market for the third consecutive day and it shot past the psychologically important mark of $2,100-per-ounce early on Monday to hit a new high of $2148.99 per ounce.

The rally also had its impact on domestic prices as the yellow metal breached the Rs 64,000-per-10-grams mark on MCX.

Later in the day, however, there was a sharp correction and the price fell to below $2,050 per ounce level to around $2020 per ounce later at night.

In the local markets, going by the peak gold with 999 purity was priced at around Rs 67,500/10gm that included taxes.

This was a new all-time high price. On Friday and Wednesday too, the yellow metal's price had recorded new life-high marks.

Surendra Mehta, president, Indian Bullion & Jewellers Association, said the recent surge in gold prices in the international markets was on the back of news of a US warship and some commercial ships coming under attack in the Red Sea.

"The market has made a huge high in just two months from $1,820 levels to nearly $2,150 so it needs a correction because it needs some news to rise again," he said.

On the other hand, Avinash Gupta, former director, All India Gems & Jewellery Domestic Council, feels the surge was not substantiated by any fundamentals and was driven only by anticipation of the US Fed slashing interest rates much earlier than expected.

"Apart from the anticipation of early rate cuts, there was also an anticipation of a deeper 200-250 basis point cut in rates among punters which seems to have triggered this spike. The market is highly volatile and is being driven by just speculative activity as the new high was not substantiated by volumes," he said.

However, Anil Jain, partner of Hyderabad based M Nemichand Jain Jewellers, was of the opinion that gold is witnessing a bullish streak and could scale a new all-time high of $2,250 per ounce anytime soon but after a correction.

"Gold has broken all levels and is in bullish territory so much so that any small news can trigger a $100 per ounce jump in a day. I expect it to hit the Rs 70,000 per 10gm mark (including taxes) in the Indian market before December 15," he said.

"If it trades below $2,056 per ounce today it can go down to $2,029 or $2,003, which is a major support level, after which it will trigger a buy with $2,250 as the next high. But if it closes below $2,000 it will enter the bearish zone," Jain added.


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