The Indian market stayed true to its volatile demand, as gold rates on Monday 19/11/18 fell by some 50 rupees to reach a cumulative price of Rs. 32,100 per 10 gram. This drop in price is believed to be a reaction to the muted demand from domestic jewelers, as they rally from the extensive selling and buying during the festive season. Weak overseas prices in the United States are also believed to play a role in this muted demand.
Silver, which remained unhinged for most of the day, also took the path laid down by gold to end up with a decrease in price of around Rs. 50 to reach the per kg price of Rs. 38,100. Gold with 99.9 percent and 99.5 percent purity witnessed a fall of around Rs. 50 each, as they were valued at Rs. 32,100 and Rs. 31,950 per 10 gram of gold by the end of the day’s trading. Gold prices saw an increase of Rs. 135 on Saturday, which was somewhat negated due to the muted response on Monday.
The prices for Sovereign gold remain unaltered throughout the day of trading and stayed at a cumulative rate of Rs. 24,800 per 8 gram piece. Silver prices also tracked global gold and Indian gold prices to drop down by Rs. 50 to reach the rates of Rs. 38,100 per kg. Silver coins, however, didn’t witness any gains or falls, as they continued to trade at a rate of Rs. 73,000 for buying and Rs. 74,000 for the selling of 100 pieces.
The rupee today saw a minor strengthening, as the exchange rate against the US dollar reached Rs. 71.5. The higher value of the rupee in terms of the dollar reduces the cost of imported gold within the country.
The prices for gold in the international markets softened down a bit, as the prices solidified after the four sessions of gain out of five in the market during last week. The prices for spot gold fell by some 0.1 percent in the open market, to reach the value of $1,219.98 per ounce. United States gold futures also fell by some 0.3 percent to reach the price of $1,219.6 per ounce.
“After four days of upside, gold is at a normal profit booking level … 1,225-1,230 is a resistance zone for gold,” said Vandana Bharti, who is currently serving as the assistant vice-president of commodity research firm SMC Comtrade Ltd.
Gold prices across the globe were supported by a muted dollar due to the Federal Reserve’s concerns for the global economy. The general belief that the FED might just maintain a neutral outlook for the remaining days of 2018, and the slowdown within the global economy due to the China-US spat have made gold a wealthy safe haven for investors. Investors analyzed the interest in gold, and found that the socio-political factors weighed in quite significantly.