New Delhi, May 18 (IANS): Gold prices in India on Monday retreated from the record high levels touched earlier in the day.
Both in the spot and futures market, gold touched record levels of Rs 49,700 and Rs 47,980 per 10 grams earlier in the day, on the back of high demand as the both global and Indian economy face uncertainty amid the coronavirus crisis. Investors generally turn to gold in times of uncertainty as it is considered as a safe haven asset.
Currently, the June contract of gold on the MCX is trading at Rs 46,932 per 10 grams, lower by Rs 449 or 0.95 per cent from its previous close.
The spot price has come down to around Rs 49,000 per 10 grams.
The domestic prices fell tracking a decline in the US markets, said Bachhraj Bamalwa, a Kolkata-based jeweller.
Bamalwa, who is also a former Chairman of the All Indian Gems and Jewellery Federation, said the ongoing instability in India and globally has led to the surge in demand for gold and surge in its prices.
"The bull run for yellow metal continues as it gains over 15 per cent in value since January 2020. Gold prices touched near Rs 48,000 per 10 gm on MCX, even in the international market, gold is trading near a 7-year high level of $1760/oz. Apart from gold, prices of silver and palladium, too have seen an uptick as prices of precious metal move in tandem," said Nish Bhatt, Founder & CEO, Millwood Kane International.
Commenting on the surge in the gold prices earlier in the day, Bhatt said: "The rally in gold prices is primarily due to uncertainty in Indian as well as the global market due to Covid-19 and tensions escalating between US and China which could lead to further trade tariffs. Reports of further stimulus by US on the back of economic trouble is also one of the reasons for the spike in gold prices."
He noted that traditionally gold is seen as a hedge against inflation, and lack of return from other asset classes has pushed investments in favour of the yellow metal. As gold is an international commodity, going forward prices will continue to be in focus till clarity emerges on the vaccine for the virus and the global economy opening up for trade like before, Bhatt said.