India News | Gold Plunges Rs 350; Silver Rises Rs 200

New Delhi, Aug 7 (PTI) Gold prices plunged by Rs 350 to Rs 71,350 per 10 grams in the national capital on Wednesday amid a fall in the precious metal in the overseas markets.

In the previous session, gold of 99.9 per cent purity closed at Rs 71,700 per 10 grams on Tuesday.

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However, silver prices bounced back after four straight days of massive decline. Silver rose by Rs 200 to Rs 82,200 per kilogram from Rs 82,000 per kg in the previous trade, according to the All India Sarafa Association.

Meanwhile, gold of 99.5 per cent purity also declined by Rs 350 to Rs 71,000 per 10 grams. It had settled at Rs 71,350 per 10 grams in the previous close.

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Traders attributed the decline in gold prices to a reduction in domestic customs duty and global influences.

On the global front, gold at Comex was quoted at USD 2,393 per ounce, down by USD 16 from the previous close.

"Comex gold declined as the US Treasury yield headed higher along with the dollar index.

"The ongoing halt to gold purchases by the People's Bank of China (PBOC) weighed on the bullions while it was the third consecutive month in which the Chinese central bank didn't buy any gold," Dilip Parmar, Research Analyst at HDFC Securities, said.

According to Kaynat Chainwala, AVP-Commodity Research at Kotak Securities, Comex gold (December) futures edged lower on Tuesday due to a recovery in the US dollar and US Treasury yields.

However, the decline was limited by expectations of multiple interest rate cuts and safe-haven demand from heightened tensions in the Middle East, Chainwala said.

In addition, silver was marginally down at USD 26.90 per ounce in the international markets.

"Gold prices remained volatile, trading between USD 2,380 and 2,396 in Comex, with some support due to the depreciation of the Yen against the dollar.

"Traders will be closely watching the weekly jobless claims data set to be released on Thursday for further direction for the gold prices, Jateen Trivedi, VP Research Analyst - Commodity and Currency at LKP Securities, said.

As per Rahul Kalantri, Vice-President of Commodities at Mehta Equities Ltd, the market participants are awaiting signals regarding the extent to which the US Federal Reserve will reduce interest rates this year.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)