Gold futures price surged to record high of Rs 57,786 on the Multi Commodity Exchange on Tuesday amid rally in the price of yellow metal internationally and depreciation in rupee, but the surge dampened demand for gold in the world's second biggest market of the precious metal.
Gold futures for January contract rose as much as 0.9 per cent to hit an all-time high of Rs 57,786.
In spot market, Gold price rose by Rs 295 to Rs 57,217 per 10 grams in the national capital on Tuesday amid gains in the precious metal globally, according to HDFC Securities.
The yellow metal had ended at Rs 56,922 per 10 grams in the previous trade.
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In the overseas market, gold was quoting higher at $1,938 per ounce while silver was down at $23.64 per ounce.
“After posting a double-digit return in 2022 gold is looking set to replicate it in 2023. Gold prices have rallied nearly 4 per cent in January month alone. It has gained over Rs 7,000/10 grams from its November lows, where it slipped below the Rs 50,000/10 gram mark,” said Colin Shah, founder and managing director of Kama Jewellery.
The primary reason for the rally in the yellow metal is the weakness in the US dollar. This US Fed hinted at a slower rate hike or max only one last rate hike of 25 bps in this cycle. The recession fear in the West is providing strength to gold and pressure on dollar. Major countries like China, India, and Russia are paying for their imports in local currencies - a move that is putting pressure on the US Dollar, Shah said.
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“Moving forward, we expect some more rally in gold prices. Domestically, Gold prices are expected to hit the Rs 58,000-59,000 level. On the global front, the prices are likely to touch earlier highs and trade in the range of $2,060-2,100/oz,” Shah added.
(With PTI inputs)
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