Gold Price In India Maintained Above Rs. 50,000 Despite Continuous Drag Overseas

Gold price on the MCX is defying the trend overseas and is trading by a tad higher. Last around the time of writing this copy, MCX gold is trading at Rs. 50,606 per 10 gm, silver futures on the other hand is trading down and is trading below Rs. 60000 per kg.

This is because rupee's record low streak is providing a cushion to domestic gold and it is because of it that domestically the prices are not losing by a similar vigour as overseas.

Meanwhile, gold prices in the spot market overseas are being dragged lower and lower. This is on strengthening in dollar to 20-year high levels. The softness in gold is seen even though the 10-year US yield has lost some ground. Notably there is awaited release of the crucial US inflation data that shall offer cues to the monetary tightening stance going ahead.

Spot gold at the time of writing this copy is trading lower at $1725.3 per ounce.

Analysts expect more fall in the yellow metal by the end of the year given the interest rate hike and likely uncertainty in respect of recession and the like.

"Gold and silver plunged again amid strength in the dollar index. The dollar index hit fresh 20 year highs and eased safe-haven buying of precious metals. Gold prices slipped to 9-month lows and silver prices also dipped to nearly 2-year lows. Aggressive interest rate hike prospects by the U.S. Federal Reserve and strength in the dollar index weighed on precious metals," said Rahul Kalantri, VP Commodities, Mehta Equities Ltd.