Gold Prices Surge by Rs 1,400, Silver Climbs on Global Trends and Local Demand
New Delhi: On Tuesday, August 20, gold prices in the local market surged by Rs 1,400, reaching Rs 74,150 per 10 grams, marking the sharpest increase in the past month. This notable rise follows a previous closing price of Rs 72,750 per 10 grams on Friday.
Similarly, silver prices also saw a significant increase, climbing by Rs 3,150 to Rs 87,150 per kilogram from Rs 84,000 per kilogram in the last session.
The uptick in gold prices comes after a period of decline triggered by the Union Finance Minister’s announcement of an import duty cut on gold in the annual budget for FY25. On July 23, gold prices had plummeted by Rs 3,350 to Rs 72,300 per 10 grams.
On Tuesday, gold of 99.9 per cent and 99.5 per cent purity rose by Rs 1,400 each, reaching Rs 74,150 and Rs 73,800 per 10 grams, respectively.
Drivers Behind the Price Increase
Traders attribute the recent rise in gold prices to increased local demand from jewellers as well as favorable global trends. Internationally, gold is trading higher at USD 2,560.10 per ounce, up by USD 18.80 per ounce.
“Gold extended its gains on Tuesday, buoyed by expectations of aggressive US Federal Reserve (Fed) interest rate cuts,” noted Saumil Gandhi, Senior Analyst of Commodities at HDFC Securities.
According to Kaynat Chainwala, AVP-Commodity Research at Kotak Securities, Comex gold prices began the week with modest gains, peaking at a record high of USD 2,549.90 before settling at USD 2,541. This rise was driven by safe-haven demand and a weaker dollar, amid concerns over the US economy’s resilience, geopolitical tensions, and recent comments from the Chicago Fed President that reignited recession fears.
Silver also traded higher internationally, reaching USD 30.19 per ounce.
“Gold remains steady above USD 2,500 per ounce. Attention will now turn to the US Fed Chair Jerome Powell’s speech at the Jackson Hole Symposium for potential insights into the Fed’s interest rate cut trajectory,” stated Pranav Mer, VP – Research (Commodity & Currency) at BlinkX and JM Financial.
Praveen Singh, Associate VP, Fundamental Currencies and Commodities at Sharekhan by BNP Paribas, highlighted that major macroeconomic data, including the Euro-zone CPI inflation due later on Tuesday, will also influence bullion prices.
