Gold Price Today Nears Rs 50,500; Over Rs 5,600 Down from All-Time High; Time to Buy?

Gold prices in India edged higher on Friday, following global cues. On the Multi Commodity Exchange of India (MCX), gold futures rose 0.09 percent to Rs 50,590 for 10 grams at 09:35 hours on May 20. Silver prices, however, dropped on Friday. The precious metal futures plunged 0.08 percent to Rs 61,515 for a kilogram on May 20.

In the international market, gold prices jumped on Friday as the dollar receding from two-decade highs. Spot gold future was down 0.2 percent at $1,838.81 per ounce while US gold futures edged 0.1 percent lower to $1,839.30, Reuters reported. The prices of safe-haven metal climbed around 1.5 percent this week in the global market.

US dollar tumbled, extending its pullback from a two-decade high. A lower dollar makes gold more affordable for other currency holders. US 10-year Treasury yields also slid, lifting demand for the precious metal.

The holdings of the SPDR Gold ETF, the world’s largest gold-backed exchange-traded fund, the fund rose 0.66 percent to 1,056.18 tonnes on Thursday from 1,049.21 tonnes on Wednesday.

To tame rising inflation, US central bank is likely to raise the interest rates higher by the end of this year than anticipated earlier, a Reuters poll mentioned. The higher interest rates may send gold lower in the future because of competition from higher-yielding investments, opined some analysts. ‘

Gold Price Today: Should you Buy?

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“International gold prices have started flat and could remain range-bound to firm this Friday’s trade if the dollar extends further losses going into the weekend. Lack of any major data in today’s trade could keep the gold movements limited and could track the dollar. Today’s range of Spot LBMA gold is $1820.00-$1860.00,” said Sriram Iyer, senior research analyst at Reliance Securities.

“Domestic gold futures prices could start flat and could remain range-bound to firm this Friday’s trade tracking overseas markets. A stronger Rupee could keep upside capped. Today’s range of MCX gold June is Rs 50,150-50,850,” he added.

“Gold prices are witnessing indecisiveness as growth worries, geopolitical uncertainty and spiralling inflation are pulling it up whereas firm US dollar and upside in bond yield is eroding gold’s sheen. Investors are not able to decide whether to buy on dips or short on highs. The indecisiveness in gold may remain for some time. Buy Zone Above – Rs 50,650 for the target of Rs 50,900.

Gold Price Price Outloook

“Global equity markets witnessed a sharp sell-off, bolstering the attraction of the safe-haven metal, as fresh signs of slowing growth led investors to move into safe-haven assets. Gold is said to be a good inflation hedge. However, the metal’s upside was limited as the dollar strengthened in response to the US Federal Reserve’s strong policy response to rising prices. and were near their two-decade highs,” said Saish Sandeep Sawant Dessai, research associate, Base Metals, Angel One Ltd.

“Gold is projected to trade higher, regaining its strength, as fears of an economic downturn linger and the dollar continues to retrace, helping the safe-haven commodity,” he added.