Gold prices on Friday tumbled to a 23-month low by losing Rs. 1,150 to Rs. 25,650 per 10 grams in the national capital on heavy selling by stockists and investors, triggered by a steep fall in overseas markets.
All round selling by stockists on free-fall in overseas markets and investors shifting their funds to surging equities mainly pulled down the gold prices to a level last seen on August 9, 2011. Silver also dropped by Rs. 1,490 to trade below Rs. 40,000 at Rs. 39,010 per kg on poor offtake by jewellers and coins makers.
Traders said the sentiment dampened as gold in Singapore plunged to nearly three-year low by dipped below $1,200 an ounce on improving US economic data strengthening the case for the Federal Reserve to reduce stimulus.
Gold in overseas markets, which normally set price trend on the domestic front, dropped $24.40 to $1,200.80 an ounce and silver by 0.05% to $18.51 an ounce.
They said investors shifting their funds to surging stock prices further influenced the market sentiment.
In the national capital, gold of 99.9 and 99.5% purity registered a hefty fall of Rs. 1,150 each to Rs. 25,650 and Rs. 25,450 per 10 grams, respectively. Sovereigns declined by Rs. 200 to Rs. 23,800 per piece of eight grams.
In line with a gold trend, silver ready dropped by Rs. 1,490 to Rs. 39,010 per kg while weekly-based delivery rose by Rs. 130 to Rs. 39,700 per kg.
Silver coins also nosedived by Rs. 2,000 to Rs. 75,000 for buying and Rs. 76,000 for selling of 100 pieces.