Gold price: Gold may become dearer in near term, but remain bullish, says expert

Gold is likely to become dearer in India amid chances of falling rupee because of geo-political tensions including the one developing on India’s borders, Senior Technical Analyst Anuj Gupta said. He said that even as the yellow metal price rises, it still remains a safe investment bet as it will be trading in positive territory in the near term due to its safe haven value.

Gupta who is a Deputy Vice President, Commodity and Currency Research at Angel Broking, said that the MCX August Gold Futures will likely reach Rs 47700 in the next two trading days.

At 1:25 pm, August Gold Futures were trading at Rs 47233 per 10 gram, down by 0.7 per cent from the previous close.

Gupta was bullish on Gold ETF too, saying that the instrument has been getting good traction. He added that the May Gold ETF buying is likely to remain good, though the data was still not out. Gold ETF has got a very good response in April, Gupta said. The April month saw a record buying by investors, he said.

As for international prices, Gold prices held steady on Wednesday, supported by concerns stemming from a surge in coronavirus infections in Beijing but with hopes for a potential COVID-19 drug and a stronger U.S. dollar limiting their advance.

Spot gold was flat at USD 1,727.26 per ounce by 0717 GMT, holding a tight USD 6 narrow range. US gold futures were mostly unchanged at USD 1,736.60.

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A record increase in US retail sales in May supported views the US recession might be drawing to an end, with upbeat trial results for a COVID-19 treatment further aiding investor sentiment. Geopolitical tensions and additional stimulus measures from global central banks also offered some support to bullion, which is often used as a safe store of value during times of political and financial uncertainty.

Inputs from Reuters