Gold glitters to hit over 2-mth high on global cues; up Rs 340

Gold prices surged Rs 340 to hit over two-month high of Rs 26,550 per ten grams at the bullion market today, taking positive cues from global market amid pick up in buying by jewellers to meet wedding season demand. Silver too recovered and reclaimed the Rs 34,000-mark by rising Rs 220 to Rs 34,015 per kg on increased offtake by industrial units and coin makers. A weaker rupee, which plunged to hit fresh 28-month low of 67.59 against the dollar yesterday that made imports costlier also supported the upside in gold prices.

Bullion traders said sentiment got a boost after gold gained the most in six weeks overseas as Chinese stocks fell into a bear market and the US retail sales capped the weakest year since 2009, increasing demand for precious metals. Gold in New York, which mostly determines the price trend in the Indian market, rose 0.96 percent to USD 1,088.80 an ounce and silver gained 0.61 percent to USD 13.91 an ounce in the yesterday's trade. Moreover, increased buying by jewellers at domestic markets, driven by wedding season also buoyed sentiment.

Back home, in the national capital, gold of 99.9 and 99.5 percent purity surged by Rs 340 each to Rs 26,550 and Rs 26,400 per ten gram respectively, a level last seen on November 3 last year. It had shed Rs 40 yesterday. Sovereign gold followed suit and edged higher by Rs 100 to Rs 22,400 per piece of eight gram.

A similar trend was also seen in silver ready that recovered by Rs 220 to Rs 34,015 per kg and weekly-based delivery by Rs 225 to Rs 34,025 per kg. Silver coins also spurted by Rs 1,000 to Rs 49,000 for buying and Rs 50,000 for selling of 100 pieces.