A global sell-off in precious metals has prompted a continued plummeting in prices of gold and silver in the Indian marketplace. A look at the happenings over the past month would reveal that gold has been under tremendous stress. This, according to a Live Mint report, could be due to concern among investors that the improvement in the US economic scenario, as well as rising inflation, might force the pullback of Fed support.
The Indian markets witnessed a fall in gold and silver prices, mainly due to the global currents. The MCX recorded a decline of 1.3 per cent or Rs 600 to a four-month low of Rs 46,029 per 10 gram in the futures trade. Meanwhile, silver also dropped 1.6 per cent or Rs 1,000 to Rs 63,983 per kg. These figures are compared with the plummeting of Rs 1,000 and Rs 2,000 respectively in the previous sessions.
Fed move prompts Gold price fall
Spot gold dropped by 2.3 per cent to $1,722.06 per ounce after touched $1,684.37 earlier in the session, while silver fell 2.6 per cent at $23.70, the report added. The slump in gold rates by 4.4 per cent globally today is said to have been triggered by fears that the Federal Reserve might up rates soon.
It is also being reported that weak ETF flows could also weigh too much on gold. The Live Mint report added that holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, nosedived to 1,025.28 tonnes on Friday, from 1,027.61 tonnes on Thursday.
Tracking the scenario, the report quoted CapitalVia Investment Advisor saying that the US Dollar Index gained gains soon after the Non-farm Payrolls report had hinted at the addition of close to 943,000 jobs in July. It added that the treasury yields have been riding high following rumours that the Federal Reserve would snip its asset purchase program in 2021. The gold-silver ratio had also moved higher to stay at 7 2.45 this week, which may also be a pull-down in the silver price.
India bond issue open
The India mart witnessed the Sovereign Gold Bond Scheme 2021-22 – Series V for subscription a while ago.
The bond’s issue price – At Rs 4,790 per gram, the bond’s issue price rides on the average closing price stated by the India Bullion and Jewellers Association for gold of 999 purity in the last three business days.
The report added that a Rs 50 per gram discount is due to investors applying and making payments online.
