Domestic gold prices jumped by over Rs 1,000 per 10 gram or 1.4% in evening trade, taking cues from the surge in the international markets. Gold’s safe haven appeal was in play after US unemployment data for July was reported higher at 4.3% versus 4.1% in June.
Around 7:30 pm, MCX October gold futures were trading at Rs 70,850 per 10 gram. Its intraday high was Rs 70,965.
The US generating fewer jobs in the previous month has raised concerns over its economy while boosting chances for a Federal Reserve rate cut.
Yellow metal futures, which move inversely to the dollar index (DXY), saw a 1.3% jump on Comex and were trading at 2,510.30 per troy ounce. Meanwhile, the DXY plunged by over 1%, slipping below the 104-mark against a basket of six top currencies.
Silver futures also moved in tandem, riding on the gains in its shinier peer. The September contracts gained by Rs 2,106 per kg or nearly 2.5% to hit the day’s high of Rs 84,700. It was trading at Rs 83,700, higher by Rs 1,106 or 1.34%.Commenting on bullion movement, Jateen Trivedi, Vice President, Research Analyst – Commodity and Currency at LKP Securities said that the rise in prices was driven by renewed fears of a US recession following higher jobless claims and escalating tensions in the Middle East, fueling safe-haven buying. Anuj Gupta, Head Commodity & Currency, HDFC Securities said the chances of a Fed rate cut are more than 80% now and a Fed commentary on the timing in the Wednesday monetary policy has pepped-up the yellow metal. In July, gold futures prices declined by 2.69% or Rs 1,927 while they are up by 10.21% or Rs 6,452 per 10 gram on the year-to-date basis. As for silver, the white meta fell 4.10% or by Rs 3,571 in the month gone by. In the year, so far, the gains have been to the tune of Rs 12.31% or Rs 9,166 per kg.
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