In early trade on Tuesday, gold futures on MCX (Multi Commodity Exchange of India) was trading at Rs 50,587 per 10 grams, which is 0.2 percent lower than the previous day's closing price. Silver futures were trading flat at Rs 62,097 per kg.
Factors of price change remain same
On Monday, gold price in Delhi was at Rs 51,740 per 10 grams after international prices of the yellow metal rose to $1,909 per ounce and silver was quoting with marginal gains at $24.64 per ounce, over uncertainty on US stimulus and rising coronavirus cases. The weaker dollar also supported buying in gold.
With the global tally of confirmed COVID-19 cases crossing the 40 million mark and caution set in ahead of the deadline to reach an agreement on a new US coronavirus stimulus, the factors ruling the metal pretty much remain the same as the previous day, yet has somehow diminished the appeal for the safe-haven metal that is known for being a hedge against inflation and uncertainty.
On Tuesday, spot gold fell 0.1 percent to $1,903.16 per ounce.
US House of Representatives Speaker Nancy Pelosi said that she hopes that by the end of Tuesday there will be "clarity" on whether a coronavirus stimulus bill can be passed before the November 3 elections.
Stuck in a loop
The overall pattern appears to have not changed with international gold prices being stuck between $1,900 and $1,920 (December futures) an ounce and silver between $23 and $60 (December futures).
Gold and silver prices in India are impacted by movement in the international market and changes in rupee's exchange value against the US dollar.
Outlook: Gold to rise above Rs 53,000, Silver above Rs 68,000 By Diwali: Nirmal Bang
Kunal Shah of Nirmal Bang Commodities told CNBC-TV18, said that gold and silver prices in India could see a sharp rally in a month's time.
"The investment demand is robust, another stimulus is expected out of US, and India and China retail demand is also back. So, I think gold and silver both are going to rally," he said.
Shah expects gold prices in India to be at Rs 53,000-53,500 per 10 gm by Diwali and Rs 54,000 by the end of the year. Meanwhile, he expects silver prices to be Rs 68,000-69,000 per kg by Diwali and Rs 70,000-73,000 by the end of the year.