Gold hits record high of Rs 46,000/10 gm

Gold prices extended gains for the sixth straight day to hit a record high of Rs 46,034 per 10 gram in the Mumbai bullion market on fear of global recession caused by novel coronavirus pandemic. The precious metal gained after US Federal Reserve announced a $2.3 trillion stimulus on April 9 to support the US economy.

The major gold trading centres in the country have been shut due to lockdown announced by state governments to prevent spread of COVID-19.

The rate of 10 gram 18, 22, and 24-carat gold in Mumbai was Rs 34,526, Rs 42,167 and Rs 46,034 plus 3 percent GST, respectively.

Explaining the run-up in the yellow metal, Sunilkumar Katke, Head - Commodities & Currency, Axis Securities, said investors are seeking refuge in safe-haven assets like gold and dollar due to the coronavirus pandemic.

“Gold prices are trading near a one-month high scaled last week as mounting worries about the global economic outlook due to the novel coronavirus outbreak and the US Federal Reserve's stimulus measures kept bullion elevated,” Navneet Damani, Vice President, Motilal Oswal, said.

The broader trend on Comex could be $1,675-1,705 and on domestic front prices could hover in the range of Rs 45,900-46,600, Damani said.

The gold/silver ratio currently stands at 107.30 to 1, which means the amount of silver required to buy one ounce of gold. Silver prices gained Rs 870 to Rs 42,900 per kg from its closing on April 9.

In the futures market, gold rate touched an intraday high of Rs 46,385 and an intraday low of Rs 45,622 on MCX. For the June series, the yellow metal touched a low of Rs 36,572 and a high of Rs 46,385.

Gold futures for delivery in June gained Rs 961, or 2.12 percent on the MCX closing at Rs 46,255 per 10 gm. The same for August delivery rose Rs 947, or 2.08 percent, at Rs 46,433 per 10 gm.

The value of the June and August contract traded for the day was Rs 2,240.24 crore and Rs 97.15 crore, respectively.

Similarly, Gold Mini contract for May jumped Rs 936, or 2.07 percent at Rs 46,215.

At 12:01 pm (GMT), spot gold was up by $8.49 at $1,692.12 an ounce in London trading.