New Delhi, Oct 29: Gold prices on Wednesday rebounded by Rs 2,600 to Rs 1,24,400 per 10 grams in the national capital, snapping a two-session losing streak, amid a fresh wave of safe-haven buying ahead of the policy outcome by the US Federal Reserve.
Gold of 99.5 per cent purity appreciated by Rs 2,600 to Rs 1,23,800 per 10 grams (inclusive of all taxes) from the previous close of Rs 1,21,200 per 10 grams, according to the All India Sarafa Association.
The precious metal of 99.9 per cent purity had settled at Rs 1,21,800 per 10 grams on Tuesday.
“Gold prices rebounded on Wednesday, reclaiming the psychological level of USD 4,000 per ounce ahead of the highly anticipated FOMC (Federal Open Market Committee) policy meeting outcome,” Saumil Gandhi, Senior Analyst – Commodities at HDFC Securities, said.
Silver also witnessed a sharp rebound as prices surged by Rs 6,700 to Rs 1,51,700 per kilogram (inclusive of all taxes). The white metal had ended at Rs 1,45,000 per kg on Tuesday, as per the association.
Gandhi said bargain buying and a renewed demand for safe-haven assets, following rising geopolitical concerns in the Middle East region.
In the international markets, spot gold climbed by USD 77.26, or 1.95 per cent, to USD 4,029.53 per ounce, ending a three-day losing streak.
“Spot gold is currently trading around at USD 4,020 per ounce as the metal tries to recover from its Tuesday’s low of USD 3,886 ahead of the FOMC monetary policy decision due tonight.
“The Fed is widely expected to cut rates by 25 basis points as it has turned its focus on the weakening job market,” Praveen Singh, Head of Commodities and Currencies at Mirae Asset Sharekhan, said.
The metal is still not out of the woods, though a Fed rate cut will limit the downside, he added.
Meanwhile, the dollar index rose 0.15 per cent to 98.82 ahead of the Fed outcome, while optimism over signs of easing US-China trade tensions may cap further upside in safe-haven demand, analysts said.
Spot silver rose by 2.85 per cent to USD 48.40 per ounce in the overseas markets.
Persistent geopolitical risks also remain after the US Senate again failed to clear a Republican-backed bill to end the government shutdown.
The White House cancelled a planned meeting between US President Donald Trump and Russian President Vladimir Putin after fresh sanctions were imposed on Moscow’s top oil companies, which might continue to support the precious metal, according to experts.
