SRINAGAR: Gold prices rose for the seventh straight session on Wednesday, climbing Rs 2,600 to Rs 1,59,800 per 10 grams in the national capital as strong investor demand and global market gains pushed the precious metal higher, according to the All India Sarafa Association.
Gold of 99.9 per cent purity, including all taxes, was quoted at Rs 1,59,800 per 10 grams, compared with Rs 1,57,200 on Tuesday.
The latest rise has taken gold up by Rs 12,400, or 8.4 per cent, from Rs 1,47,400 per 10 grams on August 3.
Silver prices also advanced sharply, rising Rs 4,000 to Rs 2,46,000 per kg from Rs 2,42,000 in the previous session.
Analysts said investors increased purchases of gold as a safe asset ahead of the release of US inflation data, while continuing tensions in West Asia also supported demand for precious metals.
Gaurav Garg, Head of Research at Lemonn Markets Desk, said these factors helped lift gold prices in the domestic market.
Saumil Gandhi, Senior Analyst – Commodities at HDFC Securities, said lower US Treasury bond yields and a steady US dollar also supported gold and other precious metals.
In international markets, spot gold rose USD 44.48, or 1.02 per cent, to USD 4,412.63 an ounce. Silver was up 2.37 per cent at USD 66.23 an ounce.
Analysts said gold received further support after US inflation figures broadly matched market expectations. Consumer price inflation in the US eased slightly to 3.4 per cent in July from 3.5 per cent in June.
The inflation reading was in line with forecasts, keeping expectations about the US Federal Reserve’s interest-rate decisions in focus.
Analysts said the outlook for bullion remained dependent on energy prices and interest rates. Higher energy costs could keep interest rates high for longer, which can make non-interest-bearing assets such as gold less attractive.
Praveen Singh, Head of Commodities at Mirae Asset ShareKhan, said gold was also being supported by a recovery in exchange-traded fund holdings. Holdings had risen to 97.24 million ounces, the highest level since June 24 and more than one million ounces above the cycle low of 96.16 million ounces.
