Gold up by Rs 100, reclaims Rs 32,000-level on local jewellers' buying

Gold prices reclaimed the Rs 32,000-level by rising Rs 100 to Rs 32,080 per 10 grams today, taking strength from scattered buying by local jewellers amid a firm trend overseas.

Silver also strengthened by Rs 200 to Rs 40,500 per kg due to increased offtake by industrial units and coin makers.

Gold prices firmed up after falling for three straight days, mainly because of fresh buying by local jewellers at the domestic spot market, coupled with a better trend globally.

Globally, gold rose 0.26 per cent to USD 1,315 an ounce and silver by 0.64 per cent to USD 16.50 an ounce in New York yesterday as the dollar backed off its day's highs, raising demand for the precious metals.

In the national capital, gold of 99.9 per cent and 99.5 per cent purity rebounded by Rs 100 each to Rs 32,080 and Rs 31,930 per ten grams, respectively. It had lost Rs 220 in the previous three days.

Sovereign, however, held steady at Rs 24,700 per piece of eight grams.

Gold sparkled in 2017 despite record surge in US stocks, 3 Fed rate hikes

Gold is opening the new year on the front foot. Bullion advanced for an eighth straight day to head for the longest stretch of gains since mid-2011, building on an annual surge that pushed the precious metal to its best year in seven as the dollar weakened.

Bullion for immediate delivery advanced as much as 0.5 per cent to $1,309.32 an ounce, the highest level since September 26, and was at $1,309.06 at 6:37 am in London, according to Bloomberg generic pricing. Last year, the commodity climbed 14 per cent as the Bloomberg Dollar Spot Index lost 8.5 per cent to post the steepest decline since at least 2005.

Gold's strong run in 2017 came even as US stock markets surged to records and the Federal Reserve increased interest rates three times amid signs of an improving economy. Fed policy makers are projecting another three hikes in 2018, while other central banks around the world have also shifted toward a tighter monetary stance, with the European Central Bank planning to halve its asset purchases starting this month.

"As global complacency over the trajectory of US rates continues to be astoundingly low, precious metals, in general, should continue to benefit," Jeffrey Halley, senior market analyst at Oanda Corp in Singapore, said in a note. "The old adage that the market can stay irrational longer then you can stay solvent appears to be alive and well in the gold market at the moment."
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