Gold prices hit record high, reach Rs 96,300 per tola in Pakistan

Analyst says beyond near-term disruptions to supply chains coronavirus could have an effect on headline GDP

Analyst says beyond near-term disruptions to supply chains coronavirus could have an effect on headline GDP

"The commodity's rise past-$1,700 can take aim at highs marked during November and October 2012, respectively near $1,751 and $1,794".

USA gold futures settled 1.7% higher at $1,676.60 an ounce.

"They are going into a full-court press into gold...as concerns are growing that people see the virus potentially damaging economies and economic growth around the globe. The Dow Jones is down about 1,000 points, the bond yields are also lower".

The sudden spread of the virus in Italy, which poses wider fears of a spread in other European countries, was accompanied by the rise of cases in South Korea. The reasons for this current phenomenon lays in the slump in China's economy and stock market amid the corona virus disease, says Kumar Jain, vice chairman of Shree Mumbai Jewellers Association.

The World Health Organization (WHO) said it is anxious about the growing number of cases without any clear link to China.

Yields on top-rated, tax-exempt US municipal bonds fell to all-time lows of 1.01% in 10-year paper and 1.6% in 30-year debt, according to Municipal Market Data.

Among other safe havens, the U.S. dollar edged higher as the rapid spread of the new flu-like virus drove fears of a pandemic, while the benchmark United States 10-year Treasury yield hovered close to its lowest since early September.

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At the same time, oil prices fell more than 3% on Monday, as investors anxious about a fall in demand following the temporary factory closures due to the virus.

Meanwhile, inventory markets in Europe opened decrease, with London's FTSE 100 down 2% within the opening mins. Worldwide bullion prices have risen since stock markets are in a slump and gold is the only safe haven, says Surendra Mehta, national secretary of the India Bullion and Jewellers Association (IBJA). With this, the futures price of gold on June 5, 2020 has also broken its record today.

Analysts expect gold may breach the Rs 45,000-mark in the local market, while silver trade over Rs 50,000 (both without the GST).

In the futures market, gold rate touched an intraday high of Rs 43,176, and an intraday low of Rs 42,371 on the MCX.

As per experts, the price of gold may even go higher than the current price.

Among other precious metals, silver eased about 0.3% to $18.58 per ounce.

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