Gold prices surged to a new peak of Rs 34,500 per 10 grams in the bullion market on Wednesday as the rupee descended to record low at 68.80, registering its biggest single-day loss of 256 paise, as global oil prices jumped, deepening concerns about the current account deficit and capital outflows.
However, late selling by stockists reduced the initial gains and the yellow metal closed with a biggest ever single-day gain of Rs 1,900 to Rs 33,900 per 10 grams.
It is also gold’s highest closing level of all time, crosiing the previous record of Rs 32,975 on November 27 last year.Silver also registered a steepest rise of Rs 3,700 to Rs 58,500 per kg on increased offtake by industrial units and coin makers.
The rupee has been witnessing an unprecedented plunge in its value as it dropped to an all-time intra-day low of 68.75.
Gem & Jewellery Export Promotion Council Chairman Vipul P Shah in talks with The Pioneer said that: “It is very difficult to predict gold prices in coming days. Depreciating currency is the problem and we all want stable currency.”
“Another reason could be the prevailing tension in Syria and the speculation that the US could lead military action against Syria within days spurring investors’ demand for a haven,” he added.“I think marriage season will further boost the prices in coming days,” he replied when asked about marriage season will further increase the prices.
Similarly Gitanjali Gems Chairman & MD, Mehul Choksi says that “Rupee volatility is the main reason behind gold prices and there will be demand scarcity at this rate.” However, he said, marriage season is nothing to do with higher prices.
While on the one hand, gold buyers and sellers across the country expressed disappointment on the price hike of the precious metal, experts on the other hand held a different view saying that it is the right time to invest.
Meanwhile, jewellers are expecting customs authorities to release soon gold held up at warehouses due to confusion over RBI’s recent notifications on import of the precious metal.
The central bank had come out with a circular on July 22 that said 20 per cent of an imported consignment should exclusively be made available for exports.As the Customs were unsure of how to implement RBI notification, they stopped all stocks from entering the country, jewellers claimed.
“We hope the Central Board of Excise and Customs will release the gold, which is deposited at the Customs bonded warehouses, in a day or two as we have discussed and clarified the confusion on the RBI notification earlier this week,” Gems and Jewellery Export Promotion Council Vice Chairman Pankaj Parekh told .