Gold has been on a rally this week gaining 2%. The movement has been more notable since Thursday following a 25 bps rate cut by the European Central Bank (ECB).
Expert Anuj Gupta, Head Commodity & Currency at HDFC Securities said that the ECBβs rate cut has propelled the price of gold and silver. The sentiments were also positive on hopes of rate cuts by China, he added.
China is poised to cut interest rates on more than $5 trillion of outstanding mortgages as early as this month, according to people familiar with the matter, as it accelerates a move to reduce the borrowing costs for millions of families to spur consumption, a Bloomberg report said.
Gupta said that the gains could have been even better if custom duty on gold and silver is taken out of the picture as international spot prices of gold have shot up by 25% in 2024 till now.
Gold fell 6% on July 23 after Finance Minister Nirmala Sitharaman slashed customs duty on gold and silver to 6%.Expert Prathamesh Mallya, DVP- Research, Non-Agri Commodities and Currencies at Angel One calls gold a “portfolio diversifier for investors, going on to say that it could be a substitute for equities in the near to medium term for less risk appetite investors. Geo-political problems and US elections are strong triggers to keep gold’s haven appeal up, he added.Gupta expects the positive trend in gold to continue in the run-up to the Federal Reserve’s policy meeting scheduled next week. He sees MCX gold futures testing a level of Rs 75,000 very soon.
Also Read: Minor Dent! Adani Enterprises, Adani Ports, other group stocks shed up to 2% on Hindenburg’s fresh salvo
Around 12 pm today, the October gold futures on the MCX were trading at Rs 73,174, higher by Rs 350 or 0.48%.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
Source link
