Gold prices today jump as covid concerns boosts demand for yellow metal

Market


Gold prices surged today in Indian markets, tracking a global rally in the precious metal as concerns over a new Covid variant spreading in South Africa boosted the metal’s safe-haven appeal. On MCX, December gold futures were up 1.4% to 48,073 per 10 gram while silver futures jumped 0.4% to 63420 per kg.  Despite today’s surge gold is down about 1,200 per 10 gram from this month’s high as fears of earlier-than-expected tightening of US monetary policy weighed on the precious metal. 

On global markets, spot gold jumped 1% to $1,805.56 per ounce. Further aiding gold’s climb, the dollar index eased 0.2% from a 16-month peak scaled earlier this week, while US benchmark 10-year Treasury yields also weakened. A weaker dollar reduces gold’s cost to buyers holding other currencies.

Among other precious metals spot silver was steady at $23.57 per ounce while platinum fell 1.2% to $983.22.

A turnaround is possible as long as gold holds the support of $1780 but a  unexpected drop below the same would negate the trend and liquidate further, Geojit said in a note. 

On silver, “expect a choppy trade inside $25.50-23 levels initially. Breaking any of the sides would suggest fresh short term direction,” it added. 

The spread of the new variant in South Africa and some other countries has prompted Britain and a growing number of other countries to hurriedly introduce travel restrictions on the African nation.

The World Health Organization and scientists in South Africa are studying the recently identified variant, which has been described as very different to previous versions and of serious concern. 

Equities sold off today as the detection of the strain comes on top of concerns in markets about high inflation and the prospect of quicker exit from ultra-loose monetary settings.

The World Health Organization is convening an experts’ meeting later today to evaluate whether the new variant is a “variant of concern.”

Oil prices slid, with US crude futures down 5.7% to $73.96 a barrel and Brent crude down 4.66% to $78.38 amid fresh demand fears. 

Covid concerns pushed investors towards the safe-haven assets as the yen jumped more than 1% to around 113 per dollar, having languished earlier this week at five-year low. (With Agency Inputs)

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