Gold climbs by Rs 416; silver zooms Rs 1,014

Representative Image

Representative Image

Gold prices in the national capital on Friday rallied by Rs 416 to Rs 50,802 per 10 grams, according to HDFC Securities. In the previous trade, the yellow metal settled at Rs 50,386 per 10 grams.

Silver also surged by Rs 1,014 to Rs 61,343 per kg from Rs 60,329 per kg in the previous trade. “Spot gold prices for 24-carat gold in Delhi were up by Rs 416 reflecting overnight rally in COMEX gold prices,” said Tapan Patel, Senior Analyst (Commodities) at HDFC Securities.

In the international market gold was quoting lower at USD 1,850 per ounce and silver was trading flat at USD 21.90 per ounce.

Gold prices have fallen about 1.5% in what has been a volatile week, after starting it near a one-month peak before hitting a four-week low on Tuesday.

“We haven’t really moved a whole lot. We’re still kind of stuck in this $ 1,800 to $ 1,880-90 range looking for direction”, and gold needs clarity on the impact of rates, said Ilya Spivak, a currency strategist at DailyFX.

“That clarity will either have investors say – yes, I think inflation is going to be contained – gold lower, or no – I don’t think inflation is going to be contained, I want an alternative store of value – gold higher,” Spivak said.

World stocks headed for their worst week since a market meltdown in the beginning of the pandemic in March 2020, as investors feared sharp rate hikes tipping economies into recession. [MKTS/GLOB]

The U.S. Federal Reserve announced its biggest interest rate hike since 1994 this week, as it scrambles to rein in soaring inflation. Rising rates in the United States increase the opportunity cost of holding non-yielding gold.

“Going forward, we expect dollar strength and recovering bond yields to cap gold prices”, as the Fed delivers on its hawkish stance, Fitch Solutions said in a note. [US/] [USD/]

“However, prices will not collapse back to pre-COVID-19 levels as gold will remain supported by the evolving Russia-Ukraine war, rising global inflation, and the still persisting pandemic.”

Spot silver fell 0.6% to $ 21.79 per ounce, and platinum dipped 0.5% to $ 945.50, while palladium rose 0.8% to $ 1,893.87. All were headed for weekly declines.