By Dilip Kumar Jha
MUMBAI: Gold prices rose 0.84% on Tuesday to hit the highest in 33 months on fresh buying from investors amid expectations of easy monetary policy by leading economies across the world.
Standard gold in the popular Zaveri Bazaar here closed with a gain of Rs 260 at Rs 31,480 for 10 gms on Tuesday following global cues. This level of gold price was not seen after October 2013. Physical traders, however, abstained from fresh buying on expectations of a correction in prices following a long-due profit booking.
Gold has suddenly found safe-haven buying interest from investors and jewellers. Funds have started picking up stake in gold resulting in the yellow metal extending gains into the second day after expectations on interest rate hike by the US Federal Reserve this year diminished.
“A sharp increase in gold prices has kept physical buyers absent. Demand of physical metal has crashed. Bullion dealers, therefore, are prompted to sell their inventory with a discount, which hovers around $40-45 an oz. More than the physical demand, fluctuations in the global currencies, especially yen, is supporting gold’s upward movement,” said Prithviraj Kothari, managing director, RiddhiSiddhi Bullions Ltd, a Zaveri Bazaar based bullion dealer.
In London, gold price jumped $11 to trade $1,352 an oz in early afternoon trade. Silver was trading rangebound at $19.81 an oz on Tuesday.