Gold price hits life-time high of Rs 53,526 on US dollar collapse; experts predict further rise

Gold price today hit its all-time high of Rs 53,526 per 10 gm at the Multi commodity Exchange (MCX).

According to the commodity experts, this rise is due to the collapse of dollar by nearly 5.5 per cent in the last ten forex trade sessions and rising tension between the US and China. Photo: PTI

Gold price today hit its all-time high of Rs 53,526 per 10 gm at the Multi commodity Exchange (MCX). According to the commodity experts, this rise is due to the collapse of dollar by nearly 5.5 per cent in the last ten forex trade sessions and rising tension between the US and China. They said that the yellow metal will continue its rally and in the next one month, we can expect it to hit Rs 54,000 per 10 gm at the MCX. In the international markets, experts predict $2,000 per ounce of gold.

Speaking on the reason for rise in gold price, Amit Sajeja, Associate Vice President at Motilal Oswal said, "Gold price has been rising due to two major reasons — US dollar collapsing to the tune of 5.5 per cent in the last ten forex trade sessions and US bond yields almost close to negative territory." Sajeja said that dollar price crash is combination of weak US economy and rising US-China tension. While the US and its allies are trying to corner China in global merchandise, China is also reacting sharply to that and in result the global economy is getting hit badly. And the rest of the impact is of Coronavirus.

"Due to the traditional investment tools not yielding high returns, global investors have moved towards gold that has made it an investors haven. This is expected to continue and so does the gold price rally," said Sajeja of Motilal Oswal.

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Highlighting other reasons for gold price rise, Anuj Gupta, Deputy Vice President — Commodities and Currencies Research at Angel Broking said, "Today gold again made a new life time high of Rs 53,526 levels. Weakness in dollar due to new government data underscored the US GDP and deep economy due to coronavirus and the US president raised the possibility of delaying the November Election. US GDP collapsed 32.9 per cent during the second quarter and job loss claims rose last week. So, we expect Gold trend to remain positive . Traders can buy gold around Rs 52800 to 52900 levels with the stop loss of Rs 52200 and for the target of Rs 53,800 levels. We also expect gold may test $2000 level soon."

Gupta said that in next one month gold price is expected to hit Rs 54,000 per 10 gm at MCX.

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