In line with the global trend, the price of gold in New Delhi jumped by Rs 930 on Thursday to close at an all-time high of Rs 35,800 per 10 grams. Internationally, spot gold was trading at USD 1,420.80 an ounce (that is, approximately Rs 34,019 per 10 grams). Gold prices have been moving up ever since concerns over US-China trade war have come to the fore.
Why is gold rising?
While the prices have been going up over the last couple of months, it jumped sharply on Friday following Fed Chairman Jerome Powell’s testimony to the Congress where he indicated to cut rates in its forthcoming FOMC meeting scheduled for July 30-31.
In India, the gold prices also witnessed a spurt following the government’s Budget announcement to hike the customs duty on gold import from existing 10 per cent to 12.5 per cent.
While trade war concerns and Fed’s expected decision to cut rates alongside a cautious stance on US economy prompted investors to move towards safe-haven assets like the yellow metal, in India, prices have adjusted for the customs duty hike.
Is the price rise expected to continue?
There is a sense in the market that if the global growth continues to remain down and trade war concerns keep lingering, the price of gold may inch up further.