Gold surpasses over six year high, retail price in metros consistently up for 10 sessions

Last Updated: Tue, Jun 25, 2019 17:58 hrs

Gold has surpassed a six year high to trade at $ 1439.14 per ounce on US commodity markets. The last high that Gold prices recorded was on April Fools day, 2013 - $ 1560 per ounce.

Gold's all time high of $ 1823.30 per ounce was recorded on 1st August 2011. Although it is unlikely that Gold prices could reach this high again, current trends and cues suggest a bear market for the yellow metal.

Several key central banks have indicated of growth slowdown. The Federal Reserve conceded last week that it was in no hurry to raise rates. This was a sentiment echoed by several central banks. A slip in growth rates is suggested as a factor that could potentially dissuade investors from the markets.

Also, there has been a corresponding rise in investor worry owing to geopolitical tensions such as the US-Iran relationships.

Last week, expectations of any improvement in the US-Iran relations took an ugly retreat with the downing of a US drone. Later, media reports said that the US launched cyberattacks on Iranian military computers.

This week, the US administration has signed fresh sanctions on Iran's Supreme Leader. President Trump was quoted as saying that "Assets of Ayatollah Ali Khamenei and his office will not be spared."

News-reports said that Iranian leader Ayatollah Khamenei had been dead since 1989, but the White House said that sanctions were on the current Supreme Leader of Iran.

Post the announcement on sanctions, Iran's foreign ministry spokesperson said this meant a "permanent closure of the path of diplomacy."

Iran President Hassan Rouhani's was quoted in news reports as saying that US was lying about offers on negotiations. He also said that the White House was "afflicted by mental retardation".

Such signs of geopolitical stress usually leads to a demand for Gold, considering investors perceive the yellow metal as a safe haven for their investments.

Surprisingly Gold rates across various Indian markets too have peaked. Gold prices have consistently risen in the past ten days across major Indian cities. In fact the lowest rate in many cities was recorded in the third week of May. For instance, rates for 24 Karat Gold in Kolkata were the lowest on May 23 at Rs 33,187.17. The highest was recorded today at Rs 35,946.52. Rates in the past five trading days in the city have increased by at least 4 percent so far.

The dollar rates at the moment seem to be the only saving face for those keen on buying Gold in the country. The dollar index, which measures the greenback against six major peers decreased 0.24 per cent at 95.9838 in late trading on Monday. The Rupee opened stronger against the Dollar on Tuesday, gaining 23 points to settle at Rs 69.35 against the greenback.

Traders and bullion dealers hint that geopolitical uncertainties coming back to haunt investors, genuine buyers could find Gold rates peaking to fresh highs by the end of this week.

Do check Sify Gold rates and ensure that you get the best bargain for your investment.

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