Volvo ditches diesel for its smallest SUV, but plumps up value
The XC40 T4 R Design gets more equipment, and a new petrol powertrain, in addition to a better safety kit
As the crisis around Middle-East started mounting, the gold prices touched all-time high levels in spot market hitting ₹40,092 per 10 gram (PM rates for 999 purity without tax), a jump of 2.2% or ₹877 within a day.
Spot silver prices also mirrored gold, with a sharp surge from ₹46,340 per kg on Thursday to ₹47,330 a kg – up by Rs 990 or about 2% in a day.
Investors flocked to the yellow metal as the safe haven demand triggered amid looming uncertainty on what transpires from the Iranian retaliation to the US's Thursday's action against its military leader.
“We are seeing all time high levels today. The rally is primarily because of the tensions following the US-Iran military actions. The near-term outlook appears bullish because of the geopolitical crisis in the Middle-East region," Prithviraj Kothari, President, India Bullion and Jewellers Association Ltd (IBJA) told Businessline.
In futures, MCX Gold for February contract gained 1.87 per cent with last quoted price of ₹40,010 per 10 gram. CME Gold futures, meanwhile, hit a recent high of $1,548 an oz during intra-day, while it last quoted at $1,541.
According to Kothari, besides the Central banks, which have been constantly accumulating gold at every dip in prices, it is also the investors, who are rushing for safe haven asset amid uncertainty in the other financial assets.
As per the recent World Gold Council data, Central Banks have been increasingly piling up their gold reserves. Gold purchases during 2019 jumped 43% to 629.4 tonnes (upto November 2019) as against 437.5 tonnes last year. Central Banks in Turkey, Russia, Poland and China were the top ones to make heavy gold purchases during 2019.
But Kothari also pointed out that at the fresh peak levels, physical gold demand will take a pause and there will be profit-booking by those holding gold of a lesser value. “We may see some bit of profit booking in physical market because of the latest surge in the prices. So we may see some pause in the India's gold price rally going forward," added Kothari.
Abhishek Bansal, Chairman, ABans Group of Companies, commented, “Gold prices are at four-month high in CME as tensions have increased in the Middle East. Gold also found support after China announced a reserve rate cut by 50 bps from January 6 to support the economy. An easing monetary policy will increase liquidity in the Chinese market and demand for gold will pick up. Domestic gold prices are likely to rally further following weakness in the Indian rupee after crude oil prices have surged nearly 4%.”