As lockdown curbs have started, one of the most affected amongst luxury products is gold, which was under pressure because the risk sentiment of price has increased on gold. The United States of America have clinched losses of gold. But, this will barely affect the entire jewelry and luxury products during the novel COVID-19 pandemic.
While in the case of India, the gold prices strived for momentum for the third day in a row. The Multi Commodity Exchange (MCX) is an independent commodity exchange based in India, mentioned that gold futures were down marginally at Rs. 47,137 per 10 grams. While in the case of silver it seems some profit-taking after their strong run. According to MCX, July silver futures down 0.21% to Rs.50,505 per kg. About 25% of silver had surged in the past one month on optimism because industrial demand reviving as more countries reopen their strong run, this shows the silver industry has become reviving in most of the countries which helps the economies stronger. So, countries should depend upon both the Gold and Silver sectors for the countries growth. Now it hits the record of about Rs. 48000 per 10 gram even the gold prices in India have traded in a narrow range.
When coming to global markets, gold prices inched lower on optimism of economic recovery as more countries ease lockdown curbs. The losses in gold happened due to China-US tensions, it led to protests in the United States and a weaker dollar. According to statistics, spot gold was down 0.1% at $1,738.12 per ounce and platinum was up 0.3% to $850.19, and silver price is declined from 0.5% to $18.17.
According to a survey the growth of factory activity in China has returned and increased in May as restrictions of lockdown were eased but the improvement was marginal. While the US is facing one of the most severe economic downturns in 11 years because of the coronavirus pandemic. In the US and China tensions scenario, US Secretary of State Mike Pompeo said that America is welcoming people from Hong Kong in response to China’s push to impose national security legislation in the former British colony. The world’s largest gold-backed Exchange-Traded Fund (ETF) has risen from 0.5% to 1,128.40 tonnes.
Kotak securities noted that the fluctuation of gold is one of the vital reasons for the declining consumer demand for gold. The central banks and governments are catching stimulus measures for avoiding challenges to global economies. The US dollar was near an over two-month low today, making gold less expensive for holders of other countries. There is an advantage that rupee closed near a two-week high against the US currency which makes import to the country less expensive.
