On Wednesday, price of 24-carat gold in India slipped below Rs 48,500 per 10 grams as investors across the globe flock to riskier assets after progress in COVID-19 vaccine and Joe Biden's transition into the White House.
On MCX (Multi Commodity Exchange of India), gold futures declined to as much as Rs 48,418 per 10 grams on 25 November, mirroring losses in the international market. Spot gold slipped 1.5% to $1,807.95 an ounce, after touching its lowest since 17 July at $1,800.01.
Prices are close to falling below the psychological level of $1,800 as optimism on economic recovery has caused investors to withdraw from the safe-haven asset.
The US as well as Indian markets hit record highs on Tuesday. NSE's Nifty 50 breached the 13,000 level while Dow Jones Industrial Average broke above 30,000 for the first time.
At the start of the week, AstraZeneca became the third pharma company to report successful COVID-19 vaccine trails. AstraZeneca's vaccine is cheaper to make, easier to distribute and faster to scale-up than rivals.
This news was followed by Trump administration making federal resources available to President-elect Joe Biden's team for his transition into office. The markets also cheered Biden's choice of Janet Yellen as Treasury Secretary as the former Federal Reserve chair is widely expected to focus on fixing the economy rather than the progressive Democratic agenda.
When economic prospects look brighter, investors choose riskier assets like stocks over gold, making it cheaper.