gold surges to $1982 as investors sees banking crises ahead article
investors sees banking crises ahead article
Ingots of 99.99 percent pure gold are placed in a workroom at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, January 31, 2023. REUTERS/Alexander Manzyuk
March 16 (Reuters) - Gold prices edged higher on Thursday, bouncing towards last session's 1-1/2 month peak as concerns about the banking crisis continue after the European Central Bank hiked interest rates despite the ongoing financial stability risks.
Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Jane Merriman and Krishna Chandra Eluri
Gold prices have surged on Thursday amid fears of a banking crisis across the world. Gold's safe haven status got an impetus after the Silicon Valley Bank collapsed last week, followed by the troubles at Swiss lender Credit Suisse.
But gold prices in the domestic market were down despite positive global cues for the metal. In the domestic market, the price of 10 grams of 22 carat gold now stands at Rs 53,050, down from Rs 53,150 per 10 grams on Wednesday. On Multi Commodity Exchange, gold April futures on Thursday were trading at Rs 57,950 per 10 grams, down Rs 386.
The price of 24-carat gold has also gone down. On Thursday, the price of 10 grams of gold was decreased by Rs 110 to Rs 57,870.
The silver rate is down 0.49 per cent. Silver May futures were trading lower by Rs 333 at Rs 66,966 per kg on MCX.
According to Reuters, spot gold was up 0.1 per cent at $1,919.86 per ounce, after rising more than 1 per cent on Wednesday. US gold futures fell 0.2 per cent to $1,927.80.
On Wednesday, gold prices declined after US consumer price data came in line with expectations. The precious metal was still around the price of $1,900 an ounce after surging for three consecutive sessions.
"Gold prices were sharply up and silver near steady on Wednesday, as both metals hit five-week highs yesterday on safe-haven demand. Fears of a global banking and financial crisis are growing which is further fuelling a rally in gold. The banking turmoil that started in the U.S. late last week has spread to Europe. Falling US Treasury yields and a much stronger US dollar index today are indicative for traders and investors to hold safe-haven assets. The European Central Bank meets today and is expected to raise its main interest rate by 50 basis points. However, the shaky banking sector in the Euro zone at present may at the last minute alter the ECB's plans," said Rahul Kalantri, VP Commodities, Mehta Equities.
We expect gold and silver to remain highly volatile in today’s session. Gold has support at $1900-1888 while resistance is at $1922-1934. Silver has support at $21.55-21.40, while resistance is at $22.00-22.18. In INR terms gold has support at Rs 58,080-57,810, while resistance is at Rs 58,650, 58,820. Silver has support at Rs 66,920-66,510, while resistance is at Rs 67,990–68,580,” said Kalantri of Mehta Equities.
The banking crisis that started in the US late last week with the collapse of the Silicon Valley Bank has now affected Europe. Falling US Treasury yields and a much stronger US dollar index today are indicative for traders and investors to hold on safe-haven assets.
The European Central Bank meets today and is expected to raise its main interest rate by 50 basis points. However, the turmoil in the banking sector in the Euro zone may force ECB to change its plan at the last minute.
The gold price is recovering and has rallied in four of the past five trading sessions. Credit Suisse’s fiasco after the collapse of Silicon Valley Bank (SVB) has triggered the risk of financial instability globally and uncertainty over the interest rate decision by the Federal Reserve scheduled for next week, has cemented strong appeal for Gold price.
About the Creator
Enjoyed the story? Support the Creator.
Subscribe for free to receive all their stories in your feed. You could also pledge your support or give them a one-off tip, letting them know you appreciate their work.
Comments
There are no comments for this story
Be the first to respond and start the conversation.