In India, gold prices continued their upward rally for the third consecutive day on June 11, 2020. The latest rally is fuelled by global rates which have risen to more than 1-week high after the US Fed's meet on Wednesday gave weak economic projections, sighting contraction in growth by 6.5% in the ongoing year. This pushed the safe haven appeal of the yellow precious metal.
Gold prices in the futures market for August delivery on the MCX spurted by over 1.11% to Rs. 47144 per 10 gm.
International gold rates scale to over 1-week high
In the international market, spot gold was down in the session after earlier hitting an over 1week high and traded at $1732.56/ounce.
Also, in its projections, the US Fed has committed to maintain interest rate near zero levels until at least the year 2022. And by the end of the year, unemployment levels will remain at 9.3%.
Other factors supporting gold prices of late
1. Weakness in dollar index:
Expectation of more of stimulus measures as well as grim outlook pulls back the greenback, which supports gold prices.
2. Profit taking in equities also triggered gains for the metal:
As profit taking was seen on the streets after a phenomenal back to back rally, there was again gains seen on the precious yellow metal.
Outlook for gold price
In a case when the gold trades in the range of Rs. 47000 to Rs. 47200, the metal is expected to touch a price between Rs. 47500- Rs. 48000.
Back in India, dealers in the market, expect demand for the metal to be restored not before October.