Gold hits new high of Rs 48,130 per 10 gram, silver up Rs 730 per kg

Gold prices extended gains for the fourth consecutive day to hit a new lifetime high of Rs 48,130 per 10 gram in the Mumbai bullion market on June 22, tracking global cues. The metal continued the upside on heightened risk sentiments with a record rise in coronavirus cases across the world.

The warning from the other Fed official of longer than expected time of recovery also supported gold.

Market participants are trying to evaluate whether countries will continue with reviving and improving economic activity or they may enforce restrictions to contain the virus.

The rate of 10 gram 22-carat gold in Mumbai was Rs 44,087 plus 3 percent GST, while 24-carat 10 gram was Rs 48,130 plus GST. The 18-carat gold quoted at Rs 36,098 plus GST in the retail market.

Navneet Damani, Vice President, Motilal Oswal said gold prices rose in the early morning session to their highest in a month as surging coronavirus infections intensified concerns over a delay in global economic recovery and prompted investors to seek the safe-haven metal. Market participants are also keeping an eye on developments in Hong Kong after details of a new security law for the territory showed Beijing will have overarching powers over its enforcement.

Focus is also on the border tensions between India and China, where things can escalate quickly.

The World Health Organization reported a record increase in global coronavirus cases on June 21, with the total rising by 183,020 in a 24-hour period increasing bets for safe-haven assets. SPDR holdings rose 2.03 percent to 1,159.31 tonnes on Friday from 1,136.22 tonnes on Thursday.

The broader trend on COMEX could be in the range of $1735-1775 and on domestic front prices could hover in the range of Rs 47,900-48,550.

Ravindra Rao, VP- Head Commodity Research, Kotak Securities said gold traded moderately higher near $1,760 but was off intraday high of about $1,775 . Gold benefitted from safe-haven buying amid increasing concerns that rising virus cases worldwide may force nations to re-impose restrictions hurting economic activity.

The gold/silver ratio currently stands at 98.57 to 1, which means the amount of silver required to buy one ounce of gold.

Silver prices jumped Rs 730 to Rs 48,825 per kg from its closing on June 19.

In the futures market, gold touched an intraday high of Rs 48,289 and an intraday low of Rs 47,792 on the Multi-Commodity Exchange (MCX). For the August series, the yellow metal touched a low of Rs 39,200 and a high of Rs 48,289.

Gold futures for August delivery slipped Rs 74, or 0.15 percent, at Rs 47,863 per 10 gram in evening trade on a business turnover of 14,123 lots. The same for October delivery rose Rs 34, or 0.07 percent, at Rs 48,107 on a business turnover of 5,700 lots.

The value of the August and October contracts traded so far is Rs 2,659.09 crore and Rs 43.40 crore, respectively.

Similarly, Gold-Mini contract for July eased Rs 47, or 0.10 percent at Rs 47,860 on a business turnover of 9,734 lots.

MCX Gold price has intraday support at Rs 47,760-47,630 whereas resistance is at Rs 48,040-48,225, according to Motilal Oswal.

The broking firm said spot gold has support at $1,737-1,730 whereas resistance is at $1,758-1,765.

At 1216 GMT, spot gold was up $2.54 at $1,746.61 an ounce in London trading.

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