Gold crosses Rs 15,000 on fears of prolonged slump

MUMBAI: The rally in gold prices continued on Thursday with the yellow metal crossing the psychological Rs 15,000-mark in Kolkata. The relentless
rally in price has come at a time when the marriage season is in full swing, making the commodity unaffordable for many. In Kolkata trade, gold hit its all-time high of Rs 15,090 per 10 gm. In other metros too, the yellow metal continued its record-breaking spree. In Mumbai, a major gold hub in India, the prices of standard and pure gold shot up by Rs 315 and Rs 320 to Rs 14,705 and Rs 14,770 per 10 gm, respectively, as investors sought safety in the metal. In Delhi, gold advanced by another Rs 350 before closing at Rs 14,900 per 10 gm. It’s not domestic demand which is driving the price surge of the past two days. Traders attribute the rally to the strength in the overseas bullion markets as global slowdown shows little sign of abating. In the international market, the yellow metal continued to rule firm for the second day in a row on fears that the US government’s rescue plan may not revive the economy, fuelling investor demand for bullion and gold-backed exchange traded funds, dealers said. In London, spot gold rose to $942.60/944.60 an ounce at 18:00 pm IST. Gold for February ended up by $30.10 at $943.80 an ounce on the Comex division of the New York Mercantile Exchange. Back home, demand for gold jewellery is set to suffer due to a surge in prices in the midst of marriage season, a bullion merchant in Zaveri Bazaar said. According to him, physical buying will emerge again if prices fall below Rs 12,000 per 10 gm. However, a section of marketmen said that some buying by jewellery fabricators to meet the marriage season demand pushed up the gold prices to some extent. Similar firmness was also noticed in silver on sustained support from upcountry buyers after a steep rise in international prices. In the spot market, ready silver (.999) surged by Rs 750 per kg to Rs 21,550 in Chennai. In Mumbai, the white metal recorded a gain of Rs 445 to Rs 21,370 per kg. (source: Economic Times)