In the biggest single day drop in the recent times, gold prices fell by Rs 300 per 10 gm to crack below the 31,000-level on Monday. The fall, after five sessions of gains, occurred on easing demand from jewellers coupled with weak global cues. Sentiment took a hit after gold fell overseas amid positive developments on the US poll front, strengthening the dollar and diminishing appeal of the precious metal as a safe-haven.
“The trend of gold price is almost unpredictable now. The prevailing uncertainty of the yellow metal is due to the appreciation and fall of the greenback as a result of the US elections. It is unlikely that a big drop in gold price would happen.
Only after the US polls and depends on the policies of the new President, a significant impact on prices will happen,” Joy Alukkas, CMD, Joyalukkas Group told Express.
He said that the price appreciation of gold from $1150 to $1350 was without any concrete reasons. Globally, gold fell 1.29% to $ 1,287.20 an ounce and silver by 1.17% to $18.19 an ounce in Singapore.
Besides, fall in demand from jewellers and retailers at prevailing levels at domestic spot market fuelled the downtrend in the precious metals prices.
According to Ramesh S Pai, Partner, A Geeri Pai jewellery fluctuations in the bullion price is temporary and a sudden fall is unlikely. “In the domestic market the prevailing trend is that when the price is low people will buy more gold. It will boost price in the Indian market,” he said.
In the national capital, gold of 99.9 per cent and 99.5 per cent purity slumped by Rs 300 each to Rs 30,850 and Rs 30,700 per 10 gram, respectively. The precious metal had gained Rs 500 in the previous five days. Sovereign also traded lower by Rs 100 to Rs 24,500 per piece of eight gram.
Meanwhile, silver also dropped by Rs 450 to Rs 43,600 per kg at the bullion market and weekly-based delivery by Rs 395 to Rs 43,000 per kg. Silver coins, however, held steady at Rs 76,000 for buying and Rs 77,000 for selling of 100 pieces..