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Gold Falls Rs 2,00O In A Day, Silver Down Rs 6,000

By Staff
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At 11.55 pm on Friday, gold futures (February 2021) on MCX (Multi Commodity Exchange of India) closed 4.10% or Rs 2,086 lower at Rs 48,818 per 10 grams, while silver futures slumped 8.74% or Rs 6,112 to Rs 63,850/kg.

The decline in gold rates in India on 8 January was largely on cues from the international market where traders increased their short position as seen by the open interest.

Gold Falls Rs 2,00O In A Day, Silver Down Rs 6,000
 

In the global market, spot gold fell as low as $1,828.36 and was last down 3.6% at $1,843.06 per ounce, to register its worst week since November 2020, as prospects for a smooth transition of power in Washington and a jump in US Treasury yields hammered the precious complex.

Silver slid 7.3% at $25.14 per ounce, after falling as much as 9.8%, while palladium eased 2.6% to $2,356.23 per ounce. Both metals were also set to face their worst week since November.

In India, gold ended the week with a loss of Rs 1,417 or 2.82% on MCX.

Democrat control of the US Senate has raised bets for large stimulus, lifting the benchmark 10-year bond yield to its highest since March. Further, since President Donald Trump has agreed to an orderly transition of power, experts believe that there's been some temporary profit-booking currently being seen in the commodities market.

Gains in the US dollar, higher treasury yields, global equity markets trading at a lifetime high and easing of political risk, contributed as major factors for the sudden slump in rates of precious metals.

Precious metals, especially gold, are preferred investment destinations in times of uncertainties.

"Gold prices traded under pressure with recovery in US long term bond yields. The 10-year US treasury yields hit the March 2020 highs, which also triggered short unwinding in the dollar. The traders and investors rushed to book profits in gold on risk-on sentiments with buying in the dollar index. Gold prices declined with positive investment sentiments with a strong rally in equity indices," Tapan Patel- Senior Analyst (Commodities), HDFC securities was quoted saying in a Moneycontrol report.

Read more about: gold silver
Story first published: Saturday, January 9, 2021, 18:14 [IST]
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