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Paul Noronha

Gold cues: People queueing up on the auspicious day of ‘Danteras’ to buy gold and silver at Zaveri Bazar in Mumbai on Wednesday. —

Gargi Shah

Mumbai, Nov 7 Soaring gold prices continue to affect sales.

The auspicious day of “Dhanteras” on Wednesday was no different to the current trend. Sales of gold were substantially lower compared with last year as prices of the yellow metal meant for ornament zoomed to Rs 10,685 for 10 gm.

Prices of the yellow metal, which have been rising for the past few weeks, increased by Rs 275 for 10 gm on Wednesday alone. Gold of .99 finesses was quoted at Rs 10,735 for 10 gm.

Last year, on “Dhanteras” 550-600 kg of gold coins were sold. At that time, prices were around Rs. 9,200 for 10 gm. On Wednesday, hardly 82 kg sales were been reported, said Mr Suresh Hundia, President of the Bombay Bullion Association. Gold has increased by around Rs 1500 per 10 gm during the past year.

London spot gold market rose to $841.75 / oz (A.M. fix price) from the previous A.M. fixing of $817.55/oz.

Bullishness in precious metals has been persistent on account of a very weak dollar, said Mr Prithviraj Kothari, Director of Riddisiddhi Bullions Ltd.

This spike was caused primarily by rapidly growing investor interest in the metal in the face of a combination of supportive factors, including rising crude prices which topped $98 in New York , continuing impact of credit market problems and geopolitical concerns.

On the Comex division of NYMEX, non-commercials have built up large speculative long positions in the precious metal. Inflows into ETFs are also rising, traders said.

The yellow metal has had a a dream run from September last when it breached $700-mark.

“Dollar weakness is driving gold and the yellow metal is expected to cross its all-time high of $850 per ounce and reach $900 by this year-end,” said Mr. Kothari.

More Stories on : Gold & Silver | Gems & Jewellery

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