Gold price hits record high of Rs 47,823; Check what investors have been buying to make money

On MCX, Gold June futures today hit a life time high of Rs 47,823 per 10 gms further consolidating its position among weak market sentiments. At 10:40 am, the yellow metal was trading at Rs 47,802, up almost 1 per cent from the Friday close

In the Indian context, expert Amit Sajeja said that the gold may see some profit booking when the physical markets open after the lockdown. Source: PTI

Gold price has soared to a record high of Rs 47,823! On MCX, Gold June futures today hit a life time high of Rs 47,823 per 10 gms further consolidating its position among weak market sentiments. At 10:40 am, the yellow metal was trading at Rs 47,802, up almost 1 per cent from the Friday close. Senior technical analyst Anuj Gupta said that the situation for gold will further get a boost as news from US has not been very encouraging on economic front. Gupta who is a Deputy Vice President, Commodity and Currency Research at Angel Broking said that the US Economy is likely to weaken as has been suggested by Jerome Powell, Chairman of Federal Reserve.

Gupta also said that the job numbers in the US have also been hit because of the ongoing (Coronavirus) crisis which will help the bullion metal to firm up its position as a great safe haven bet going forward. Gold has traditionally been used as a safety net in time of crisis.

Another expert Amit Sajeja also sees the gold prices firming up from here. Sajeja who is Assistant Vice President, Research at Motilal Oswal said that the gold prices could touch USD 1800 levels in the next two weeks amid weak market sentiments and helped by the recent US-China trade war. In India the price would reach up to Rs 50.000, he said.

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The last 2-3 weeks have seen a heightened demand for Gold ETF which has built-up the current situation for gold.

The US interest rates will be a deciding factor as whenever the interest rates in US have gone down the gold prices have gained, he added.

In the Indian context, Sajeja said that the gold may see some profit booking when the markets open after the lockdown. The yellow metal was trading around Rs 40000 mark before the lockdown began and for people to buy at Rs 50000 was highly unlikely. Selling gold will put more cash in hand of the people he added.
Importantly, he said that demand will not emerge in physical gold.

On ETF, Gupta told Zee Business that gold as an investment option was getting a good traction as of now. Heaping praise on Gold ETF (Exchange Traded Fund), Gupta said this particular instrument alone, has got a very good response in April. The month saw record buying by the investors, with 170 tn of buying activity observed taking the overall to 3355 tn. The May Data is still not out.

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On ETF, Sajeja said that internationally ETF will get good traction. From the Indian standpoint, the market is still small and cannot make material difference as far as the overall consumption is concerned.

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