Comments
Continuing their record-breaking spree, gold and silver galloped to all-time highs in 2011 on strong demand for precious metals considered as a ‘safe-haven investment’ in times of economic turmoil and rising inflation.
Gold (99.5 per cent purity) crossed the Rs 29,000 per 10 grams level to a historic high of Rs 29,155 per 10 grams on December 8, 2011, on good local demand in view of the marriage season coupled with investment buying due to weak equity markets.
Pure gold (99.9 per cent purity) also logged a fresh peak of Rs 29,280 per 10 grams during the year.
Silver (.999 fineness) prices hit an all-time high of Rs 75,020 per kilogram on April 25, 2011, on heavy speculative and investment-driven buying in line with global markets, where the metal rose to a fresh 31-year high.
The metal witnessed a global rally amid speculation of a supply shortage. Furthermore, successful launching of e-silver by the National Spot Exchange Ltd (NSEL) sharply boosted the speculative nature of the metal.
The domestic market witnessed relentless buying in precious metals due to global volatility in view of escalating geo-political tensions across the Middle East, the subsequent impact on crude prices, sustained weakness in world equities, higher inflation and concerns over global economic growth.
In May, global markets witnessed a free-fall in prices of the precious metals as speculators dumped their long positions after metal exchanges hiked the margin requirement several times.
The overseas market saw the precious metals hold on to their risk aversion tag, hitting record highs due to continued worries over the global economic meltdown.
Nervous investors preferred to park their funds in gold as a safe investment instead of risky assets like equities after the euro zone debt crisis spread to more European countries, causing shivers in global financial markets.
Gold prices hit record highs as the dollar fell against a basket of major currencies after the US Federal Reserve’s decision to maintain its low interest regime in order to support economic recovery. In the Comex market, gold prices zoomed to a record high of $1,923.70 an ounce on September 6.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.