NEW DELHI: Gold and silver prices advanced on Monday as spike in Covid-19 cases in India threatens to derail the economic recovery. India is also scheduled to report its GDP print later in the day, which is expected to be the worst in decades.
Global coronavirus cases surged past 25 million on Sunday as India marked a worldwide record for daily new cases in the COVID-19 pandemic. The country’s patient count rose above 36 lakh with 64,600 people dying from it.
Gold futures on MCX were up 0.27 per cent or Rs 137 at Rs 51,585 per 10 grams. Silver futures climbed 1.89 per cent or Rs 1,302 to Rs 70,139 per kg.
Gold prices slipped by Rs 252 to Rs 52,155 per 10 grams in the national capital on Friday amid a stronger rupee, according to HDFC Securities. Silver prices, however, rose by Rs 462 to Rs 68,492 per kg.
Globally, gold prices rose on Monday to their highest level in nearly two weeks, as demand was boosted by a weaker dollar and the U.S. Federal Reserve’s new policy framework suggested that interest rates would remain low for some time.
Spot gold was up 0.4 per cent at $1,971.68 per ounce by 0043 GMT, after hitting its highest since Aug. 19 at $1,976 in early Asian trade. However, gold is down nearly 0.2 per cent so far this month. US gold futures rose 0.4 per cent to $1,982.50.
Lower interest rates decrease the opportunity cost of holding non-yielding bullion and weigh on the dollar, making gold cheaper for investors holding other currencies. The dollar index fell 0.2 per cent and was on track for its fourth consecutive monthly decline.
China’s factory activity expanded at a slightly slower pace in August. Japan’s factory output rose for a second straight month in July, while retail sales fell for a fifth straight month.
Speculators reduced their bullish positions in COMEX gold and raised them in silver contracts in the week to Aug. 25.
On the physical side, dealers in India offered the highest discounts on gold in five months last week as a dip in domestic prices failed to revive demand.
Silver jumped 1.7 per cent to $27.94 per ounce, platinum rose 0.4 per cent to $935.06, and palladium gained 0.6 per cent to $2,217.77.