Global gold prices hit their highest level in more than 6 years, as investors bought into the safe haven asset on mounting tensions in the Middle East.
In the global markets, gold hit $1579.20 an ounce, as US President Donald Trump threatened to impose sanctions on Iraq.
This led to higher crude oil prices, which rallied almost 2 per cent. In India, gold prices crossed the Rs 40,000 per 10 grams mark. 24-karats gold at the local jeweller in Mumbai was quoting at Rs 40,010 per 10 grams, while 22 -karats gold was trading at Rs 39,010, per 10 grams.
Gold analysts see gold prices in India gaining further momentum as the rupee has been considerably weak against the dollar.
The rupee breached the 72 per mark against the US currency. It's important to note that as the rupee weakens against the dollar, gold prices tend to get costlier as India imports gold.
Demand for gold in India may fall on rising prices. However, the longer term outlook maybe positive, as global tensions continue to mount. Those who have made money on gold, it maybe a good idea to book profits and re-enter at lower levels. However, there is always a risk of middle east tensions flaring up, which could push gold prices even further.
Meanwhile, the stock market came crashing down today as Trump hinted at imposing sanctions on Iraq.