SRINAGAR: Gold prices bounced back sharply on Friday, rising Rs 1,600 to Rs 1,56,600 per 10 grams in the national capital as lower crude oil prices eased inflation concerns and encouraged investors to return to the precious metal.
Gold of 99.9 per cent purity, including all taxes, had closed at Rs 1.55 lakh per 10 grams on Thursday, according to local traders.
Gaurav Garg, Head of Research at brokerage platform Lemonn, said gold recovered from its recent sell-off as the US dollar and US Treasury yields eased, prompting investors to reassess their positions following the Federal Reserve’s interest rate hike, according to The Economic Times.
Crude oil prices fell for a third consecutive session to around USD 101 a barrel. Garg said expectations of the restoration of Saudi oil supplies and the availability of alternative shipping routes had reduced immediate concerns about supply disruptions. He added that tensions in West Asia remained a risk.
The rise in domestic gold prices followed gains in international markets. Spot gold increased by USD 50.96, or 1.17 per cent, to USD 4,392.78 per ounce.
Praveen Singh, Head of Commodities at Mirae Asset Sharekhan, said gold had extended its rally for a second consecutive day, with falling oil prices partly offsetting the impact of the US Federal Open Market Committee’s hawkish monetary policy decision.
Gold-backed exchange-traded funds recorded net inflows for the eighth consecutive day, taking total global holdings to 100.39 million ounces, up 1.44 million ounces so far this year, Singh said.
However, higher US dollar levels and Treasury yields continued to limit gains in gold.
