In two days, gold prices rallied by close to 2.5 percent on the MCX and as per analysts estimates it will soon scale to Rs. 49100 per 10gm. In the previous session, gold futures for December delivered 1.19 percent or Rs. 574
In fact in the international market, gold prices hit a 1-week high. Now for the latest triggers which are fuelling gains are as below:
1. Raging coronavirus situation which is eclipsing optimism of a earlier than expected global economic recovery from the coronavirus fall-out.
2. Stimulus hopes is also rekindling the precious yellow metal. There has been progress in the dole out of US stimulus and amid it gold's appeal as being a hedge against inflation has come to the forefront.
Senate Republican urged the Congress to pass the spending bill worth $14 trillion that includes relief package for fighting coronavirus.
3. Dollar has also retreated to its 2.5 year low.
In 2020 so far, unprecedented global stimulus measures as well as worldwide low interest regime has pushed gold higher in price by as much as 20 percent.
Outlook for gold pricing in 2021:
2021 will be a mixed year for gold, positive in the first half and negative in the second, said UBS analyst Giovanni Staunovo.
"Essentially it's driven by the vaccine use influencing central bank activity ... I'm not saying there will be a rate cut, but there'll be some discussion about a change in the policy environment and gold will start to feel the pain (in the second half)," he said.